Camden National Q3 2026 Earnings: Deposit Growth Expands Net Interest Margin

Camden National (NASDAQ: CAC) reported Q3 2026 operating revenue of approximately $68.7 million—calculated as net interest income plus non-interest income—up about 5% from $65.4 million a year earlier, while diluted EPS rose 7% to $1.34 from $1.25. Net income increased 8% to $22.8 million as higher net interest income and a lower year-over-year credit provision outweighed weaker non-interest income and higher expenses. Sequentially, deposit growth reduced reliance on higher-cost borrowings and lifted net interest margin by 15 basis points to 3.41%, although net income edged 1% below Q2.

Core Financial Results

Net interest income was the main source of year-over-year growth, rising 8% to $55.4 million. The provision for credit losses declined 36% from Q3 2025, providing another benefit, while non-interest income fell 6% and non-interest expense increased 4%.

Compared with Q2 2026, net interest income increased 5%, but the credit provision rose to $1.9 million from $710,000 and non-interest income declined 8%. Those offsets explain why quarterly net income slipped 1% despite the improvement in spread income.

The quarter’s principal financial measures were:

*Operating revenue is calculated as reported net interest income plus non-interest income.

Deposit Growth Expanded Margin While Loans Remained Flat

Total deposits increased 5% from June 30 to $5.85 billion. Core deposits, a non-GAAP measure, grew 7% to $5.2 billion and represented 88% of total deposits. Management attributed the increase to normal seasonal flows and continued customer acquisition.

The larger deposit base allowed Camden National to reduce total borrowings to $374.4 million from $571.1 million at the end of Q2. Average deposits rose 3% sequentially while average borrowings fell 26%, helping lower funding costs and raise net interest margin to 3.41%. The loan-to-deposit ratio consequently declined to 86% from 90%.

Purchase-accounting accretion remained a meaningful contributor. Net fair-value mark accretion income was $4.2 million and contributed 31 basis points to the reported margin. Excluding purchase-accounting effects, core net interest margin increased to 3.10% from 2.97% in Q2 and 2.82% a year earlier.

Total loans were nearly unchanged at $5.0 billion, declining by $2.2 million during the quarter. Home equity and residential mortgage balances grew 7% and 1%, respectively, but commercial real estate and commercial loans fell 2% and 3% because of several large prepayments.

Non-interest income was affected by lower mortgage banking and bank-owned life insurance income, which management tied to quarter-end fair-value adjustments and market conditions. Debit card income increased, while assets under administration in the wealth and brokerage businesses rose 1% during the quarter to $2.6 billion.

Profitability, Credit Quality, and the Balance Sheet

Expense growth was limited to less than 1% from Q2. The GAAP efficiency ratio improved to 54.60% from 55.42%, while the non-GAAP efficiency ratio declined to 52.44% from 53.23%; lower ratios indicate greater operating efficiency. Camden National continued investing in lending personnel while maintaining overall expense discipline.

Credit indicators remained stable. Non-performing loans declined to 0.16% of total loans from 0.24% in Q2, and loans 30–89 days past due represented 0.14%. Annualized quarterly net charge-offs remained low at 0.07% of average loans. However, the allowance for credit losses increased to 0.92% of loans from 0.91%, and the sequential increase in provision expense reflected macroeconomic factors and higher reserves for unfunded credit commitments.

Cash, cash equivalents, and restricted cash increased to $248.6 million from $99.9 million, primarily because of deposit growth and the timing of cash flows. Total assets reached $7.1 billion.

Higher interest rates during the quarter increased unrealized losses on the available-for-sale securities portfolio by $32.6 million to $77.5 million. The resulting $25.1 million after-tax increase in accumulated other comprehensive loss reduced tangible book value per share to $31.40 from $31.64 and the tangible common equity ratio to 7.73% from 7.91% sequentially. Both tangible book value per share and the tangible common equity ratio nevertheless remained above their year-earlier levels.

Regulatory capital remained above required levels, including a 12.53% Common Equity Tier 1 ratio and a 14.82% total risk-based capital ratio. Camden National did not repurchase shares during Q3; during the first nine months of 2026, it repurchased 85,131 shares at a weighted average price of $46.55. The company also declared a quarterly cash dividend of $0.42 per share.

Management Commentary

President and CEO Simon Griffiths attributed the quarter’s performance to deposit growth, customer acquisition, lower dependence on higher-cost borrowings, and disciplined expense management. Management also emphasized continued investment in lending teams and future growth, but the release did not provide quantitative earnings or revenue guidance.

Recent Insider Transactions

The supplied insider-transactions data show no open-market insider purchases or sales during the preceding six months. The latest 10 reported entries were all direct stock awards rather than discretionary market purchases.

Risks Investors Need to Watch

• Securities valuation pressure: Rising rates increased unrealized losses on available-for-sale securities, reducing tangible book value and the tangible common equity ratio from Q2.
• Limited loan growth: Total loans were essentially flat, as commercial prepayments offset growth in residential mortgage and home equity balances. Continued weakness in commercial balances could constrain growth in earning assets.
• Higher sequential credit costs: Although current credit metrics remained stable, the quarterly provision increased from $710,000 to $1.9 million because of macroeconomic factors and reserves for unfunded commitments.
• Volatile non-interest income: Fair-value adjustments reduced mortgage banking and bank-owned life insurance income, demonstrating the sensitivity of some fee-related revenue to market conditions.

Summary

Camden National’s Q3 2026 earnings benefited from a stronger deposit mix, lower reliance on borrowings, and a wider net interest margin. Those gains supported year-over-year growth in net income and EPS, but flat loan balances, weaker non-interest income, and higher sequential provisioning limited improvement from Q2. Future results will depend on whether the company can convert its stronger funding position into loan growth while containing credit costs and securities-related pressure on tangible equity.