CB Financial Services, Inc. Announces Third Quarter 2026 Financial Results and Declares Quarterly Cash Dividend

WASHINGTON, Pa.--(BUSINESS WIRE)--CB Financial Services, Inc. (“CB” or the “Company”) (NASDAQGM: CBFV), the holding company of Community Bank (the “Bank”), today announced its third quarter and year-to-date 2026 financial results.

2026 Third Quarter Financial Highlights

• Average assets were $1.67 billion for the three months ended September 30, 2026, an increase of $9.6 million compared to the three months ended June 30, 2026. Average organic deposit growth and utilization of cash balances funded average loan growth and investment security purchases. The Company’s balance sheet strategy remains centered on driving earnings growth within a disciplined, stable risk framework. These strategies include:
  • Optimizing asset mix: Redeploying repayments of indirect automobile and residential mortgage loans into higher-yielding commercial loan products. Commercial loans totaled 63.2% of the Bank’s loan portfolio at September 30, 2026 compared to 59.8% at September 30, 2025.
  • Managing funding costs: Growing core deposits to reduce reliance on higher-cost wholesale borrowings. The Bank continues to strategically shift its deposit mix toward lower cost core deposit relationships and away from higher priced funding, a favorable transition driven by the ongoing onboarding of Specialty Treasury clients that began during the first quarter of 2026.
  • Actively managing interest rate risk: Using asset-liability modeling to reduce earnings sensitivity while keeping liquidity and capital strong.
• Adjusted earnings per diluted common share (EPS) (non-GAAP) increased to $0.91 for the three months ended September 30, 2026, compared to $0.80 for the three months ended June 30, 2026.
• Adjusted return on average assets (annualized) (non-GAAP) increased to 1.15% for the three months ended September 30, 2026, compared to 1.04% for the three months ended June 30, 2026.
• Adjusted return on average equity (annualized) (non-GAAP) increased to 11.95% for the three months ended September 30, 2026, compared to 10.77% for the three months ended June 30, 2026.
• Net interest and dividend income increased for six consecutive quarters to $15.0 million for the three months ended September 30, 2026 compared to $14.5 million for the three months ended June 30, 2026, as net interest margin (NIM) improved to 3.75% for the three months ended September 30, 2026 compared to 3.68% for the three months ended June 30, 2026. The improvement in NIM resulted from an increase in the yield on earning assets to 5.44% from 5.34%, driven by higher yields on cash, securities and loans. At the same time, the cost of funds increased to 1.75% from 1.72% resulting from Specialty Treasury deposit growth primarily in interest bearing demand and money market deposits.
• Noninterest expenses decreased $126,000 to $10.3 million for the three months ended September 30, 2026 compared to $10.4 million for the three months ended June 30, 2026. This decrease was driven by a decrease in salaries and employee benefits and data processing, partially offset by increases in Pennsylvania shares tax, contracted services, legal and professional fees and advertising expenses.
• Asset quality remains strong as nonperforming loans to total loans was 0.28% at September 30, 2026.
• Book value per share and tangible book value per share (Non-GAAP) was $30.67 and $28.76, respectively at September 30, 2026. The decline since year-end 2025 resulted from an increase in accumulated other comprehensive losses due to recent increases in market rates.
• The Bank remains well-capitalized and is positioned for future growth.

Management Commentary

President and CEO John H. Montgomery commented, “We delivered solid results for the quarter with improved net interest margin and earnings. Earning asset yields continued to benefit from the balance sheet restructuring executed in the third quarter of last year, helping insulate the portfolio against rate-related repricing pressure. We also maintained disciplined expense management, keeping our cost structure aligned with the current operating environment. Looking ahead, we are focused on building loan and deposit momentum as we close out the year and head into 2027.

We continued to operate with discipline in the third quarter, maintaining a strong balance sheet and the conservative credit standards that have long served our shareholders well. Total loans decreased modestly, primarily due to the payoff of a single large relationship, and we expect payoff activity to moderate in the fourth quarter. Asset quality remained solid, and our capital position strong, with nonperforming loans at 0.28% of total loans and the allowance for credit losses covering 311.8% of nonperforming assets at quarter-end, giving us the flexibility to pursue quality growth opportunities as they arise. The underlying strength of our loan portfolio, together with our ability to manage risk effectively, positions us well as we work to grow the balance sheet.

In the third quarter, our Specialty Treasury Payments & Services program continued to perform well following its move to full operational capacity last quarter. While total deposits were essentially flat for the quarter, the program continued to strengthen the composition of our deposit base, contributing $110.8 million in deposits since year-end. As newly onboarded relationships mature and begin to consolidate more of their banking activity with us, we expect the program’s contribution to build over time. We are confident in its ability to enhance the Company’s efficiency, scalability, and earnings power, and we continue to see a healthy pipeline and strong engagement across our customer base.

Supported by solid capital, sound asset quality and ample liquidity, we are well positioned to capitalize on the opportunities ahead and remain committed to delivering sustainable, long-term value for our shareholders.”

Dividend Declaration

The Company’s Board of Directors declared a $0.28 quarterly cash dividend per outstanding share of common stock, payable on or about November 27, 2026, to stockholders of record as of the close of business on November 13, 2026.

2026 Third Quarter Financial Review

Net Interest and Dividend Income

Net interest and dividend income increased $1.9 million, or 14.5%, to $15.0 million for the three months ended September 30, 2026 compared to $13.1 million for the three months ended September 30, 2025.

• Net Interest Margin (NIM) (GAAP) increased to 3.75% for the three months ended September 30, 2026 compared to 3.64% for the three months ended September 30, 2025. Fully tax equivalent (FTE) NIM (Non-GAAP) increased 12 basis points (“bps”) to 3.79% for the three months ended September 30, 2026 compared to 3.67% for the three months ended September 30, 2025.
• Interest and dividend income increased $2.3 million, or 11.6%, to $21.6 million for the three months ended September 30, 2026 compared to $19.3 million for the three months ended September 30, 2025.
  • Interest income on loans increased $579,000, or 3.6%, to $16.6 million for the three months ended September 30, 2026 compared to $16.0 million for the three months ended September 30, 2025. The average balance of loans increased $37.8 million to $1.16 billion from $1.12 billion, causing a $535,000 increase in interest income on loans. Additionally, the average yield on loans increased 1 bp to 5.69% from 5.68% despite a 50 bp reduction in the federal funds target rate since September 2025. While this led to the downward repricing of adjustable rate loans, the impact was mostly negated by a reduction in lower yielding consumer loans due to the discontinuation of the indirect automobile loan product with the redeployment of those funds into higher yielding commercial loan products. The increase in the average yield caused a $28,000 increase in interest income on loans.
  • Interest income on investment securities increased $1.1 million, or 38.0%, to $4.1 million for the three months ended September 30, 2026 compared to $3.0 million for the three months ended September 30, 2025 driven by an 48 bp increase in average yield, coupled with a $72.6 million increase in average balances. The increase in yield was primarily due to the third quarter 2025 implementation of a balance sheet repositioning strategy of the Bank’s portfolio of available-for-sale investment securities in which $129.6 million in book value of lower-yielding investment securities with an average yield of 2.87% were sold for an after-tax realized loss of $9.3 million. Investment securities sold included $121.1 million of mortgage-backed securities and collateralized mortgage obligations issued by the U.S. government-sponsored agencies, $5.0 million of U.S. government agency securities and $3.5 million of municipal securities. The Bank then purchased $117.8 million of higher-yielding mortgage-backed securities/collateralized mortgage obligations issued by U.S government-sponsored agencies, municipal securities, subordinated debt investments and non-agency guaranteed securitizations with an expected tax-equivalent yield of approximately 5.43%. The increase in the average balance resulted from current year purchases.
  • Interest income on interest-earning deposits at other banks increased $505,000 to $798,000 for the three months ended September 30, 2026 compared to $293,000 for the three months ended September 30, 2025 driven by a $50.2 million increase in average balances and a 5 bp increase in the average yield. The increase in the volume was due to deposit growth.
• Interest expense increased $353,000, or 5.7%, to $6.6 million for the three months ended September 30, 2026 compared to $6.2 million for the three months ended September 30, 2025.
  • Interest expense on deposits increased $82,000, or 1.4%, to $5.9 million for the three months ended September 30, 2026 compared to $5.8 million for the three months ended September 30, 2025. Average interest-bearing deposit balances increased $113.5 million, or 11.1%, to $1.13 billion as of September 30, 2026 compared to $1.02 billion as of September 30, 2025, primarily as the Bank grew core banking relationships and onboarded Specialty Treasury clients. The increase in average balances accounted for a $622,000 increase in interest expense. This was partially offset as the cost of interest-bearing deposits decreased 20 bps to 2.06% for the three months ended September 30, 2026 from 2.26% for the three months ended September 30, 2025 due to the Federal Reserve federal funds target rate decreases since September 2025. The decrease in the cost of interest-bearing deposits accounted for a $540,000 decrease in interest expense.
  • Interest expense on borrowed funds increased $271,000, or 62.7%, to $703,000 for the three months ended September 30, 2026 compared to $432,000 for the three months ended September 30, 2025. Average balances increased $27.2 million as short-term borrowings were utilized to replace maturing brokered deposits.

Provision for Credit Losses

A recovery of provision for credit losses of $69,000 was recorded for the three months ended September 30, 2026. The Company recorded a $399,000 recovery of provision for credit losses on loans primarily due to a decline in loan principal of $17.8 million and favorable changes in portfolio concentrations and improvement for individually assessed loans. This was partially offset as the provision for credit losses on unfunded commitments was $330,000 and was primarily due to a $10.8 million increase in unfunded commitments and an increase in the loss rate for construction and land development unfunded commitments. This compared to a provision for credit losses of $259,000 recorded for the three months ended September 30, 2025 as the provision for credit losses on loans was $336,000 and was primarily due to additional reserves required for overall loan growth, changes in qualitative factors and an addition to individually assessed loans requiring specific reserves, partially offset by favorable changes in portfolio concentrations and the calculated loss rate. This was partially offset by a $77,000 recovery for credit losses on unfunded commitments due to a decrease in unfunded commitments.

Noninterest Income

Noninterest income increased $11.7 million to $1.0 million for the three months ended September 30, 2026, compared to a loss of $10.7 million for the three months ended September 30, 2025 as a result of $11.8 million in losses on the sale of securities from a securities repositioning strategy executed during the three months ended September 30, 2025.

Noninterest Expense

Noninterest expense increased $1.1 million, or 11.8%, to $10.3 million for the three months ended September 30, 2026 compared to $9.2 million for the three months ended September 30, 2025. Salaries and benefits increased $604,000 primarily due to revenue producing treasury and commercial banking personnel additions, merit increases and higher benefit compensation costs. Data processing expense increased $345,000 due to the implementation of enhanced treasury and commercial banking platforms in late 2025 and early 2026. Contracted services increased $127,000 due to outsourced information security and treasury consulting services.

Income Taxes

Income tax expense was $497,000 for the three months ended September 30, 2026 compared to a $1.3 million tax benefit for the three months ended September 30, 2025. This change was driven by an increase in pre-tax income to $5.8 million for the three months ended September 30, 2026 compared to a $7.0 million loss for the three months ended September 30, 2025. The effective tax rate for the three months ended September 30, 2026 was 8.5%. The minimal effective tax rate resulted primarily from a $462,000 federal income tax benefit recorded related to the purchase of a $7.7 million renewable energy tax credit during the three months ended September 30, 2026 and an increase in low-income housing tax credits. This compared to an effective tax benefit rate of 18.9% for the three months ended September 30, 2025 due to the prior period loss on the sale of securities as part of the Company’s balance sheet repositioning strategy.

Statement of Financial Condition Review

Assets

Total assets increased $80.3 million, or 5.2%, to $1.63 billion at September 30, 2026, compared to $1.55 billion at December 31, 2025.

• Cash and due from banks decreased $863,000, or 2.7%, to $30.8 million at September 30, 2026, compared to $31.7 million at December 31, 2025.
• Securities increased $64.1 million, or 22.9%, to $344.0 million at September 30, 2026, compared to $279.9 million at December 31, 2025. This was primarily due to $134.7 million of security purchases, partially offset by $56.0 million of maturities and principal repayments on amortizing securities and a $15.1 million increase in unrealized losses on the portfolio as a result of recent increases in market interest rates.

Loans and Credit Quality

• Total loans remained stable at $1.16 billion for both September 30, 2026 and December 31, 2025, and included increases in commercial real estate and construction loans of $46.8 million and $6.9 million, respectively, partially offset by decreases in commercial and industrial, consumer, other and residential real estate loans of $25.5 million, $15.4 million, $7.3 million and $5.8 million, respectively. The decrease in commercial and industrial loans resulted from the payoff of a large line of credit due to the sale of the business while the decrease in consumer loans resulted from the continued reduction in indirect automobile loan production since the discontinuation of this product offering as of June 30, 2023. This portfolio is expected to continue to decline as resources are allocated and production efforts are focused on more profitable commercial products. Excluding the $15.5 million decrease in indirect automobile loans, total loans increased $15.1 million, or 1.3%. Loan production totaled $135.0 million while $107.5 million of loans were paid off since December 31, 2025.
• Nonperforming loans, which include nonaccrual loans and accruing loans past due 90 days or more, were $3.2 million at September 30, 2026 and $5.3 million at December 31, 2025. Nonperforming loans to total loans ratio was 0.28% at September 30, 2026 and 0.46% at December 31, 2025. The decrease in nonperforming loans was due to the full repayment of a $2.0 million commercial real estate loan which was placed on nonaccrual status in the fourth quarter of 2025.
• The allowance for credit losses (ACL) was $10.0 million at September 30, 2026 and $10.1 million at December 31, 2025. As a result, the ACL to total loans was 0.86% at September 30, 2026 and 0.87% at December 31, 2025. During the current year, the Company recorded a recovery for credit losses on loans of $14,000. The ACL to nonperforming assets was 311.8% at September 30, 2026 and 190.5% at December 31, 2025.
• Net charge-offs for the three months ended September 30, 2026 were $59,000, or 0.02% of average loans on an annualized basis, compared to net recoveries for the three months ended September 30, 2025 of $88,000, or 0.03% of average loans on an annualized basis. Net charge-offs for the nine months ended September 30, 2026 were $109,000, or 0.01% of average loans on an annualized basis, compared to net recoveries for the nine months ended September 30, 2025 of $72,000, or 0.01% of average loans on an annualized basis.

Other

• Accrued interest and other assets increased $16.8 million or 56.4%, to $46.6 million at September 30, 2026, compared to $29.8 million at December 31, 2025 due to the purchase of a $7.7 million renewable energy tax credit, a $4.0 million increase in required FHLB stock as a result of increased borrowing activity, a $3.3 million investment in a low-income housing tax credit project and a $3.2 million increase in deferred income taxes.

Liabilities

Total liabilities increased $81.8 million, or 5.9%, to $1.47 billion at September 30, 2026 compared to $1.39 billion at December 31, 2025.

Deposits

• Organic deposits increased $89.6 million, or 7.2%, to $1.33 billion as of September 30, 2026 compared to $1.24 billion at December 31, 2025. Interest-bearing demand and money market deposits increased $73.7 million and $27.7 million, respectively, while time and savings deposits decreased $10.4 million and $2.1 million, respectively. This growth has occurred as the Bank began onboarding Specialty Treasury clients during the first quarter of 2026. The Bank continues to focus on building core banking relationships while seeking opportunities to strategically reduce higher priced funding.
• Brokered deposits decreased $88.5 million, or 89.8%, to $10.0 million as of September 30, 2026 compared to $98.5 million at December 31, 2025, as the Bank elected to utilize lower cost FHLB borrowings instead.
• At September 30, 2026, FDIC insured deposits totaled approximately 54.7% of total deposits while an additional 19.5% of total deposits were collateralized with investment securities.

Borrowed Funds

• Short-term borrowings increased $79.0 million to $79.0 million as of September 30, 2026 as the Bank replaced maturing brokered deposits with lower cost FHLB borrowings.

Stockholders’ Equity

Stockholders’ equity decreased $1.6 million, or 1.0%, to $156.0 million at September 30, 2026, compared to $157.5 million at December 31, 2025, primarily due to a $11.9 million increase in accumulated other comprehensive loss resulting from recent market interest rate increases, the payment of $4.3 million in dividends and $315,000 of treasury shares purchased since December 31, 2025, partially offset by $13.5 million of net income for the current year and $667,000 of shares issued as a result of stock option exercises.

Book value per share

Book value per common share was $30.67 at September 30, 2026 compared to $31.28 at December 31, 2025, a decrease of $0.61.

Tangible book value per common share (Non-GAAP) was $28.76 at September 30, 2026, compared to $29.35 at December 31, 2025, a decrease of $0.59.

Refer to “Explanation of Use of Non-GAAP Financial Measures” at the end of this Press Release.

About CB Financial Services, Inc.

CB Financial Services, Inc. is the bank holding company for Community Bank, a Pennsylvania-chartered commercial bank. Community Bank operates its branch network in southwestern Pennsylvania and West Virginia. Community Bank offers a broad array of retail and commercial lending and deposit services.

For more information about CB Financial Services, Inc. and Community Bank, visit our website at www.cb.bank.

Statement About Forward-Looking Statements

Statements contained in this press release that are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and such forward-looking statements are subject to significant risks and uncertainties. The Company intends such forward-looking statements to be covered by the safe harbor provisions contained in the Act. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Company and its subsidiaries include, but are not limited to, general and local economic conditions, changes in market interest rates, deposit flows, demand for loans, real estate values and competition, competitive products and pricing, the ability of our customers to make scheduled loan payments, loan delinquency rates and trends, our ability to manage the risks involved in our business, our ability to control costs and expenses, inflation, market and monetary fluctuations, changes in federal and state legislation and regulation applicable to our business, actions by our competitors, and other factors that may be disclosed in the Company’s periodic reports as filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

John H. Montgomery
President and Chief Executive Officer
Phone: (724) 223-8317