ConnectOne Bancorp (CBM) Q3 2026 Earnings Report
DE:CBM Q3 2026 EPS Results
- Actual EPS
- EUR 0.53
- Consensus EPS
- EUR 0.76
- Beat/Miss
- Missed by -EUR 0.24
- One Year Ago EPS
- EUR 0.70
DE:CBM Q3 2026 Revenue Results
- Actual Revenue
- EUR 165.99M
- Expected Revenue
- EUR 112.09M
- Beat/Miss
- Beat by +EUR 53.90M
- YoY Revenue Growth
- -10.37%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/22/2026
- Time
- Before Open
- Conference Call
- Thursday, October 22, 2026
ConnectOne Bancorp's next earnings date is estimated for January 28, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
No slide deck is available for this earnings event.
Q3 2026 Earnings Call Summary
The call was strongly positive. Management reported accelerating operating earnings, expanding margins, strong deposit and loan growth, improved credit quality, better efficiency, and a strategically important balance sheet restructuring. The main challenges were the nonoperating charges associated with the loan sale, competitive lending conditions, rising deposit-pricing pressure, a modest sequential decline in tangible book value, and the remaining rent-regulated exposure. Overall, the stated achievements and outlook significantly outweighed the disclosed challenges.
Management is now estimating net interest margin reaching 3.53% for the fourth quarter for 2027, with the model showing it continuing to widen throughout the year, and said whether that gets to 63 or higher at year end 2027 will depend on the number and direction of fed rate moves; approximately 1.2 million more loan balances are expected to reprice over the next 5 quarters, loan and deposit growth are projected to remain in the mid single digits while maintaining a sub-100 loan to deposit ratio, fourth-quarter OpEx is targeted to increase 2% to 2.5% sequentially, and 2027 expenses are expected to increase at the maximum by a mid single digits increase; provision expense is expected to remain fairly stable for the foreseeable future, SBA gains could be up 50% or more in SBA gains in 2027 versus this year, remaining rent regulated balances are expected to continue to decline, further smaller loan transactions are possible but should not be included in projections for the next year or 2, and remaining rent regulated charge offs are expected to be no more than 3 to 5 million, say, a quarter.
- Strong Core Operating PerformanceOperating PPNR improved to 2.01% of average assets, operating return on assets increased to 1.35%, and operating return on tangible common equity exceeded 15%, reaching the target established earlier in the year.
- Operating Earnings GrowthOperating EPS was $0.95, up 13% sequentially from $0.84 in the prior quarter, while quarterly operating earnings increased 35% from a year ago.
- Successful Balance Sheet RestructuringConnectOne executed a definitive agreement to sell up to approximately $750 million of performing, nonrelationship multifamily loans at a price north of 90%. Management said the transaction will reduce CRE concentration, improve liquidity, strengthen capital and performance metrics, and better align the balance sheet with its relationship-banking strategy.
- Reduced Rent-Regulated ExposureThe loan sale is expected to reduce rent-regulated loans from 6% of total loans to approximately 2%, or about $235 million, and cut rent-stabilized exposure by up to two-thirds.
- Improved Balance Sheet MetricsOn a pro forma basis, regulatory CRE concentration is expected to decline to 3.97 from 4.39, the loan-to-deposit ratio is expected to improve into the high-90s from the low-100s, and securities are expected to increase to 12.5% of assets from 9%.
- Strong Deposit GrowthAverage client deposits, excluding brokered deposits, grew at an annualized rate of approximately 11%. Average noninterest-bearing deposits increased approximately 14%, reflecting continued strength in the company's relationship-banking franchise.
- Margin ExpansionNet interest margin widened for the eighth consecutive quarter to 3.44%, up 2 basis points. Management said loan repricing, new loan originations, and the restructuring remain contributors, although higher deposit pricing is tempering the pace of expansion.
- Favorable Loan RepricingJust over $1 billion of loans repriced year to date, with the balances remaining on the books repricing at a weighted-average rate increase of 258 basis points. Approximately $1.2 billion more is expected to reprice over the next five quarters.
- Positive Margin OutlookManagement estimated that net interest margin could reach 3.53% in the fourth quarter of 2027 and said its model shows margin continuing to widen throughout 2027, depending on the number and direction of Federal Reserve rate moves.
- Loan and Deposit GrowthLoans grew at an annualized rate of approximately 11% sequentially, excluding the effect of the transfer to held for sale, while average client deposits excluding brokered deposits also grew approximately 11% annualized. Management is projecting loan and deposit growth in the mid-single digits while maintaining a sub-100 loan-to-deposit ratio.
- Improved Expense EfficiencyNoninterest expenses were flat for the quarter, better than the prior projection of 1.5% sequential growth. Operating expenses were 1.45% of average assets versus 1.47% in the prior quarter and 1.5% a year ago, while the operating efficiency ratio improved to 41% from 43% last quarter and 48% a year ago.
- Technology-Enabled ProductivityManagement said technology investments, including nCino workflows, are freeing bankers to spend more time serving clients and contributing to continued efficiency improvements.
- Improved Credit QualityCredit quality improved across the board. Provision expense declined to $5 million from $8.3 million, annualized net charge-offs excluding PCD loans and the loan sale fell to 7 basis points from 56 basis points, nonaccrual loans declined to $64 million from $80 million, and the nonperforming asset ratio improved to 0.44% of total assets from 0.50%.
- Low Delinquency LevelsLoans 30 to 89 days past due represented just 5 basis points, which management described as almost nothing.
- Protected Remaining Rent-Regulated PortfolioThe remaining approximately $235 million of rent-regulated loans includes more than half consisting of long-standing clients with related deposits exceeding $100 million. The remaining approximately $100 million includes nonaccruals, select PCD loans, and other criticized credits, with offsets of approximately 30% of unpaid principal balance.
- Higher-Yielding Reinvestment OpportunityManagement intends to place the majority of loan-sale proceeds into lower-risk assets with slightly higher yields. Loans being sold had a weighted-average yield based on ConnectOne-originated loans at 5.25% and acquired loans yielding 6% after purchase accounting marks, while reinvestment is expected to average yields in the low sixes.
- SBA Business MomentumManagement said the SBA pipeline is strong and indicated it would not be surprising for SBA gains to increase by 50% or more in 2027 versus this year.
- Capital Return FlexibilityThe company repurchased 50,000 shares at an average price of $32, has approximately 500,000 shares remaining under its authorization, and intends to continue repurchasing opportunistically. The board also declared a common dividend of $0.195 per share, consistent with the prior quarter and representing approximately 20% of operating earnings.
- Capital and Book Value SupportThe tangible common equity ratio was 38 basis points at quarter-end and is expected to be approximately 35 basis points higher after the loan sale. Regulatory risk-based capital ratios are also expected to rise, while tangible book value per share remained up 5.9% over the past 12 months excluding the quarter's AOCI-driven decline.
- Continued Organic Growth OpportunityManagement said client relationships are expanding, loan originations reached as much as $800 million in the quarter at rates in the high sixes, and the current pipeline was above 7% on a similar amount of lending. Management also said the company continues to obtain the pricing and spreads needed to grow the balance sheet with its targeted client relationships.
DE:CBM Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Jan 28, 2027 | 2026 (Q4) | 0.72- | 0.67 | ― | ― |
| Oct 22, 2026 | 2026 (Q3) | 0.760.53 | 0.7 | -24.36% (-0.17) | |
| Jul 23, 2026 | 2026 (Q2) | 0.730.72 | -0.46 | 253.85% (+1.18) | |
| Apr 23, 2026 | 2026 (Q1) | 0.650.64 | 0.44 | 46.94% (+0.21) | |
| Jan 29, 2026 | 2025 (Q4) | 0.650.67 | 0.44 | 53.06% (+0.23) | |
| Oct 30, 2025 | 2025 (Q3) | 0.580.70 | 0.37 | 90.24% (+0.33) | |
| Jul 29, 2025 | 2025 (Q2) | -0.36-0.46 | 0.41 | -213.04% (-0.88) | |
| Apr 24, 2025 | 2025 (Q1) | 0.410.44 | 0.37 | 19.51% (+0.07) | |
| Jan 30, 2025 | 2024 (Q4) | 0.390.44 | 0.41 | 6.52% (+0.03) | |
| Oct 24, 2024 | 2024 (Q3) | 0.400.37 | 0.46 | -19.61% (-0.09) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
