SANTA CRUZ, Calif., April 21, 2026 /PRNewswire/ — West Coast Community Bancorp ((“, Bancorp, “, OTCQX:WCCB), the parent company of West Coast Community Bank (the “Bank”), announced unaudited earnings for the quarter ended March 31, 2026, of $15.0 million, compared to $13.8 million in the fourth quarter of 2025 and $11.7 million in the quarter ended March 31, 2025.
Basic and diluted earnings per share (“EPS”) for the quarter ended March 31, 2026, were $1.45 and $1.43, respectively, which increased $0.13 and $0.12 from $1.32 and $1.31, respectively, compared to the fourth quarter of 2025. Basic and diluted EPS increased $0.34 and $0.33 from $1.11 and $1.10, respectively, compared to the first quarter of 2025.
On April 15, 2026, the Bancorp Board of Directors declared a $0.01 increase in quarterly cash dividend to $0.24 per common share, payable on May 11, 2026, to shareholders of record at the close of business on May 5, 2026.
“Our first quarter results reflect continued earnings momentum, attractive returns and ongoing balance sheet strength. Core loan growth remained solid, capital and liquidity levels were strong, and our team executed effectively in a competitive environment,” said Krista Snelling, Chairman and Chief Executive Officer of West Coast Community Bancorp.
“Given our strong earnings momentum, capital position and continued growth in tangible book value, the Board’s decision to increase the dividend reflects confidence in the durability of our performance and our ability to deliver consistent value to shareholders,” added Snelling.
Financial Highlights
Performance highlights as of and for the quarter and year ended March 31, 2026, include the following:
- Net income for the quarter ended March 31, 2026, increased $1.2 million, or 8.8%, from the fourth quarter of 2025, primarily attributed to a $359 thousand reversal of credit losses in the first quarter of 2026, compared to a $1.5 million provision for credit losses in the fourth quarter of 2025, as well as higher levels of noninterest income stemming from a $912 thousand gain on the sale of $8.9 million of non-core residential loans acquired from the merger with 1st Capital Bancorp and a $368 thousand special dividend received on our holdings of Federal Home Loan Bank (“FHLB”) of San Francisco stock. Credit losses of $258 thousand were reversed upon the sale of the non-core acquired loans in the first quarter of 2026. These favorable changes were partially offset by a $362 thousand decrease in net interest income (primarily due to two fewer number of interest-earning days in the first quarter of 2026 compared to the fourth quarter of 2025) and a $247 thousand increase in noninterest expense. The increase in earnings from the same quarter of 2025 was largely driven by increases in net interest income and noninterest income, as well as a slight reversal of provision for credit losses in the first quarter of 2026 compared to a provision for credit losses in the first quarter of 2025.
- Total loans were $2.22 billion at March 31, 2026, compared to $2.17 billion at December 31, 2025, and $2.11 billion at March 31, 2025, representing an increase of $46.8 million, or 2.2% from December 31, 2025, and an increase of $114.0 million, or 5.4%, from March 31, 2025. Loan growth during the first quarter of 2026 was most notable in commercial revolving lines of credit, especially agriculture-related businesses sourced from our new San Luis Obispo team. The organic loan growth during the first quarter of 2026 was partially offset by the sale of $8.9 million residential loans noted above and a transfer of a $10.0 million land development loan to other real estate owned (“OREO”).
- Total assets were $2.90 billion at March 31, 2026, compared to $2.88 billion at December 31, 2025, and $2.66 billion at March 31, 2025, representing an increase of $11.4 million, or 0.4%, from December 31, 2025, and $236.8 million, or 8.9%, from March 31, 2025. The quarter-over-quarter increase in total assets is largely attributed to a $46.8 million increase in loans held for investment, partially offset by a $29.2 million decrease in cash and cash equivalents and a $13.4 million decrease in available for sale (“AFS”) debt securities. The year-over-year increase in total assets is largely attributed to a $114.0 million increase in loans held for investment and a $116.5 million increase in cash and cash equivalents.
- Total deposits were $2.47 billion at March 31, 2026, compared to $2.48 billion at December 31, 2025, and $2.26 billion at March 31, 2025, representing a slight decrease of $2.8 million, or 0.1%, from December 31, 2025, and an increase of $218.0 million, or 9.7%, from March 31, 2025. The slight decrease from December 31, 2025, is attributed to the seasonal outflows associated with agriculture and non-profit depositors. The increase from March 31, 2025, was driven by new banking relationships established over the last year.
- Primary liquidity ratio, defined as cash and cash equivalents, deposits held in other banks and unpledged AFS securities as a percentage of total assets, was 14.4%, 15.9% and 11.8% at March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
- Taxable equivalent net interest margin was 5.11%, 4.99% and 5.29% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. The quarter-over-quarter increase in the net interest margin is largely attributed to the absence of $864 thousand of accelerated purchase discount accretion associated with the partial early redemption of $4.3 million of subordinated debt in the fourth quarter of 2025, which reduced the taxable equivalent net interest margin by approximately 12 basis points during the fourth quarter of 2025. The year-over-year decrease in the taxable equivalent net interest margin is largely attributed to the change in the overall composition of interest-earning assets, with a higher percentage of average interest-earning cash and due from banks balances during the first quarter of 2026 when compared to the prior year, as well as lower purchase discount accretion on acquired loans during the first quarter of 2026 compared to the first quarter of 2025. The taxable equivalent net interest margin excluding the purchase discount accretion on the acquired loan portfolio and accelerated purchase discount accretion associated with the partial early redemption of subordinated debt for the quarters ended March 31, 2026, December 31, 2025 and March 31, 2025, was 4.84%, 4.80% and 4.86%, respectively.
- The cost of funds was 1.28%, 1.46% and 1.32% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. The quarter-over-quarter decrease in the cost of funds is largely attributed to the absence of $864 thousand of accelerated purchase discount accretion associated with the partial early redemption of subordinated debt in the fourth quarter of 2025, as mentioned above. This had a negative impact of 14 basis points to the cost of funds during the fourth quarter of 2025. The year-over-year decrease in the cost of funds can be attributed in large part to lower rates paid on deposit accounts, especially money market deposit accounts, responding to the three 25-basis-point interest rate cuts by the Federal Open Market Committee (“FOMC”) in late 2025. For the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, the cost of deposits was 1.25%, 1.29% and 1.28%, respectively.
- Return on average equity (“ROAE”) was 15.76%, 14.55% and 13.83% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. Return on average assets (“ROAA”) was 2.12%, 1.88% and 1.78% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. Return on average tangible equity (“ROATE”), a non-GAAP measure, was 19.75%, 18.46% and 18.34% for the quarters ended March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
- The efficiency ratio, a non-GAAP measure, was 43.59%, 44.12% and 46.48% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively.
- All capital ratios were above regulatory requirements for a well-capitalized institution with a total risk-based capital ratio of 14.65%, 14.39% and 14.23% at March 31, 2026, December 31, 2025, and March 31, 2025, respectively. The tangible common equity to tangible asset ratio was 11.49%, 11.10% and 10.75% at March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
- Tangible book value per share, a non-GAAP measure, was $30.98, $29.85 and $26.32 at March 31, 2026, December 31, 2025 and March 31, 2025, respectively. The increase in the first quarter of 2026 was driven by net income of $15.0 million combined, partially offset by a $1.6 million increase in post-tax unrealized losses on the AFS debt securities portfolio and cash dividends declared and paid of approximately $2.4 million.
Interest Income, Interest Expense and Net Interest Margin
Net interest income was $34.1 million for the quarter ended March 31, 2026, representing a decrease of $362 thousand, or 1.1%, from $34.4 million from the quarter ended December 31, 2025, and an increase of $1.7 million, or 5.4%, from $32.3 million for the quarter ended March 31, 2025.
The decrease in net interest income in the first quarter of 2026 was attributed to a $1.8 million decrease in interest income, partially offset by a decrease of $1.4 million in interest expense. The quarter-over-quarter decrease in interest income was driven by a $1.1 million decrease in interest on loans and a decrease of approximately $696 thousand in interest income on interest-earning cash and due from banks balances and investment securities. The quarter-over-quarter decrease in interest on loans can be attributed to a 12-basis-point decrease in the average yield on loans in addition to two fewer days in the quarter to earn interest. The decline in yield can be largely attributed to an approximately $436 thousand decrease in purchase discount accretion on acquired loans. Additionally, loan products indexed to prime rate repriced downward in response to the 25-basis-point December reduction in the Federal Funds target rate. The decline in the purchase discount accretion and the impact of the FOMC’s rate cut were partially offset by an increase in average loan volumes. The quarter-over-quarter decrease in interest income on interest-earning cash and due from banks balances and investment securities is attributable to a decline in average volumes in addition to a 28-basis-point decrease in yield on interest-earning cash and due from banks balances. The quarter-over-quarter decrease in interest expense was in part driven by the absence of $864 thousand of accelerated purchase discount accretion associated with the partial early redemption of subordinated debt that occurred in the fourth quarter of 2025. Additionally, a four-basis-point decrease in the cost of deposits resulted in a $535 thousand quarter-over-quarter decline in interest expense on deposits.
The year-over-year increase in net interest income is attributed to a $2.0 million increase in interest income, partially offset by a $287 thousand increase in interest expense. The year-over-year increase in interest income is attributed to higher average balances of interest-earning due from cash balances in the first quarter of 2026, as compared to the first quarter of 2025, as well as higher average yields on investment securities during the first quarter of 2026, as compared to the same period in 2025, the combination of which contributed $1.2 million to the year-over-year increase in interest income. In addition, loan growth over the last year contributed to higher average loan balances in the first quarter of 2026, as compared to the same period in 2025. Average loan balances were approximately $106.5 million higher in the first quarter of 2026, when compared to the first quarter of 2025, contributing to a $765 thousand year-over-year increase in interest on loans. The year-over-year growth in loan balances more than offset an approximate $868 thousand decrease in purchase discount accretion on acquired loans. The year-over-year increase in interest expense is attributable to higher average deposit balances in the first quarter of 2026, as compared to the first quarter of 2025. Average deposit balances were approximately $183.6 million higher in the first quarter of 2026, as compared to the first quarter of 2025, contributing to an approximate $404 thousand year-over-year increase in interest expense on deposits. The cost of deposits was 1.25% for the first quarter of 2026, compared to 1.28% for the first quarter of 2025.
The following table compares interest income, average interest-earning assets, interest expense, average interest-bearing liabilities, net interest income, net interest margin and cost of funds for each period presented:
|
For the Quarters Ended |
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|
March 31, 2026 |
December 31, 2025 |
March 31, 2025 |
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|
(Dollars in thousands) |
Average Balance (3) |
Interest Income (1) (2)/ Expense |
Avg Yield/ Cost |
Average Balance (3) |
Interest Income (1) (2)/ Expense |
Avg Yield/ Cost |
Average Balance (3) |
Interest Income (1) (2)/ Expense |
Avg Yield/ Cost |
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|
ASSETS |
|||||||||||||||||
|
Interest-earning cash and due from banks |
$ 151,349 |
$ 1,367 |
3.66 % |
$ 164,017 |
$ 1,630 |
3.94 % |
$ 26,732 |
$ 290 |
4.40 % |
||||||||
|
Investment securities |
388,467 |
3,471 |
3.62 % |
429,125 |
3,909 |
3.61 % |
394,328 |
3,305 |
3.40 % |
||||||||
|
Loans |
2,176,972 |
37,126 |
6.92 % |
2,154,451 |
38,240 |
7.04 % |
2,070,473 |
36,362 |
7.12 % |
||||||||
|
Total interest-earning assets |
2,716,788 |
41,964 |
6.26 % |
2,747,593 |
43,779 |
6.32 % |
2,491,533 |
39,957 |
6.50 % |
||||||||
|
Noninterest-earning assets |
155,471 |
158,417 |
163,239 |
||||||||||||||
|
Total assets |
$ 2,872,259 |
$ 2,906,010 |
$ 2,654,772 |
||||||||||||||
|
LIABILITIES |
|||||||||||||||||
|
Interest-bearing demand deposits |
$ 250,878 |
573 |
0.93 % |
$ 247,632 |
604 |
0.97 % |
$ 264,206 |
642 |
0.99 % |
||||||||
|
Money market deposits |
924,729 |
5,744 |
2.52 % |
882,550 |
6,041 |
2.72 % |
709,186 |
4,864 |
2.78 % |
||||||||
|
Savings deposits |
168,082 |
346 |
0.83 % |
178,595 |
423 |
0.94 % |
176,889 |
341 |
0.78 % |
||||||||
|
Time certificates of deposits |
146,069 |
927 |
2.57 % |
149,677 |
1,057 |
2.80 % |
165,997 |
1,339 |
3.27 % |
||||||||
|
Short-term borrowings |
— |
— |
— % |
— |
— |
— % |
3,861 |
43 |
4.52 % |
||||||||
|
Subordinated debt |
7,817 |
164 |
8.51 % |
10,417 |
1,077 |
41.02 % |
11,638 |
238 |
8.29 % |
||||||||
|
Total interest-bearing liabilities |
1,497,575 |
7,754 |
2.10 % |
1,468,871 |
9,202 |
2.49 % |
1,331,777 |
7,467 |
2.27 % |
||||||||
|
Noninterest-bearing deposits |
966,367 |
1,039,184 |
956,204 |
||||||||||||||
|
Noninterest-bearing liabilities |
22,705 |
22,386 |
24,242 |
||||||||||||||
|
Total liabilities |
2,486,647 |
2,530,441 |
2,312,223 |
||||||||||||||
|
EQUITY |
385,612 |
375,569 |
342,549 |
||||||||||||||
|
Total liabilities and equity |
$ 2,872,259 |
$ 2,906,010 |
$ 2,654,772 |
||||||||||||||
|
Taxable equivalent net interest income and margin (1) |
$ 34,210 |
5.11 % |
$ 34,577 |
4.99 % |
$ 32,490 |
5.29 % |
|||||||||||
|
GAAP net interest income |
$ 34,082 |
$ 34,444 |
$ 32,345 |
||||||||||||||
|
Cost of funds |
1.28 % |
1.46 % |
1.32 % |
||||||||||||||
|
(1) Interest income on investment securities, interest income on loans, net interest income and net interest margin are presented here on a taxable equivalent basis, using the statutory federal income tax rate of 21%, and are non-GAAP financial measures. Please see Non-GAAP Financial Measures for more information. (2) GAAP interest income on investment securities totaled $3.4 million, $3.8 million and $3.2 million for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. GAAP yield on investment securities was 3.51%, 3.51% and 3.27% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. GAAP interest income on loans totaled $37.1 million, $38.2 million and $36.3 million for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. For the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, GAAP yield on loans was 6.91%, 7.04% and 7.12%, respectively. Total GAAP interest income was $41.8 million, $43.6 million and $39.8 million with a resulting earning asset yield of 6.25%, 6.30% and 6.48% for the quarters ended March 31, 2026, December 31, 2025, and March 31, 2025, respectively. (3) Average balances on loans outstanding include nonaccrual loans, unamortized net deferred loan fees/costs and unaccreted purchase discount on acquired loans. The amortization of net loan origination fees and accretion of purchase discount on acquired loans are included in interest income on loans. |
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Noninterest Income and Expense
Noninterest income for the quarter ended March 31, 2026, was $2.7 million, compared to $1.3 million for the quarter ended December 31, 2025, and $1.0 million for the quarter ended …