Independent Bank (INDB) Q3 2026 Earnings Report

The call was broadly positive, supported by record earnings and EPS, strong deposit and loan pipelines, stable adjusted net interest margin, low current net charge-offs, disciplined expenses, strong capital ratios, and continued shareholder returns. These strengths were partly offset by rising non-performing assets, expected commercial charge-offs, office credit exposure, challenged mortgage and fee-income activity, intense deposit competition, the systems-conversion delay, and ongoing macroeconomic and commercial real estate pressures.

For fourth quarter 2026, management estimates CRE and construction to increase at a low single-digit annualized percentage, C&I to increase at a mid-single digit annualized percentage, home equity to have high single-digit percentage annualized growth, mortgage balances to stay relatively flat to a low single-digit percentage increase, and point-in-time deposits to stay relatively flat to a low single-digit annualized growth rate; net interest income is expected to show a modest increase versus third quarter results, with the reported margin anticipated to land slightly north of 3.9% assuming no further Federal Reserve action, including an estimated 10 basis point benefit from loan accretion, or a couple basis points reduction if the Fed increases again in the fourth quarter with no major changes on the longer end of the curve; fee income is anticipated to grow in the low single-digit percentage range, operating expenses excluding system conversion costs to be up slightly over third quarter operating expenses, one-time core conversion expenses to be approximately $1 million to $1.5 million, and there are anticipated to be no material changes to the tax rate; the core conversion is expected in 2027 Q1, with an additional $1.5 million to $2 million of one-time expenses over the next couple of quarters, with the majority of that to be incurred in the fourth quarter.