Ponce Financial Group, Inc. Announces First Quarter 2026 Results

Strong Net Interest Margin Expansion, Capital Strength, and Deep Impact Lending Highlight Quarter

NEW YORK, April 24, 2026 – Ponce Financial Group, Inc. (Nasdaq: PDLB), the holding company for Ponce Bank, National Association, has released its financial results for the first quarter ended March 31, 2026. The report showcases robust growth in net interest income, a healthy capital position, and ongoing commitment to impactful community lending, though it also reflects some sequential declines in profitability and liquidity.

Key Financial Highlights

• Net income available to common stockholders: \$8.3 million (\$0.36 per diluted share), down from \$9.9 million (\$0.42 per diluted share) in Q4 2025, but up from \$5.7 million (\$0.25 per diluted share) in Q1 2025.
• Total net income: \$8.6 million for Q1 2026.
• Net interest income: \$28.2 million, up 1.05% from the prior quarter and up 27.13% from Q1 2025.
• Net interest margin (NIM): 3.61%, rising from 3.57% in Q4 2025 and 2.98% in Q1 2025, reflecting improved balance sheet efficiency and higher loan yields.
• Provision for credit losses: \$1.7 million, significantly higher than the negative provision in Q1 2025, indicating greater caution or credit degradation.
• Non-interest income: \$2.0 million, down 14.24% year-over-year, impacted by reduced gains on sale of SBA loans and lower grant income.
• Non-interest expense: \$17.2 million, up 2.08% year-over-year, reflecting higher marketing, insurance, and certain operating costs.
• Return on average assets (ROAA): 1.07%, down from 1.26% in Q4 2025, but improved from 0.82% in Q1 2025.
• Return on common equity (ROE): 10.37%, compared to 12.50% in Q4 2025 and 7.97% in Q1 2025.
• Efficiency ratio: 56.96%, higher than Q4 2025, but significantly improved versus the 68.70% in Q1 2025.
• Book value per common share: \$13.49, up from \$13.12 in Q4 2025.
• Cash and equivalents: \$117.2 million, down 7.06% from \$126.2 million in Q4 2025.
• Securities: \$350.7 million, down 3.97% from \$365.2 million in Q4 2025, mainly due to principal repayments and maturities.
• Net loans receivable: \$2.70 billion.
• Total stockholders’ equity: \$551.4 million, up 1.81% from Q4 2025.
• Total assets: \$3.30 billion.

Capital and Asset Quality

• Total capital to risk-weighted assets (Consolidated): 21.23%, well above regulatory minimums, but down from 23.00% in Q4 2025.
• Total capital to risk-weighted assets (Bank only): 20.00%, down from 21.63% in Q4 2025.
• Non-performing assets: Fell by 22 basis points, now at 0.62% of total assets, indicating improved credit quality.

Operational and Strategic Developments

• Ponce Financial continues to deliver on its commitments under the U.S. Treasury’s Emergency Capital Investment Program (ECIP), with 82% “deep impact” lending over the last 15 quarters, far exceeding the program’s 60% target.
• The company remains focused on investing in technology and staff to drive further efficiency and community engagement.

Management Commentary

CEO Carlos P. Naudon noted, “We again saw improvement in net interest income and margin, with the NIM up 4 basis points from last quarter and 63 basis points year-over-year. Non-performing assets declined, and our capital ratios remain strong, well above regulatory requirements. We remain committed to supporting our communities and will continue to invest in our people and technology to boost efficiency.”

Executive Chairman Steven A. Tsavaris highlighted the strong progress under ECIP and reaffirmed the company’s focus on impactful community lending.

Price-Sensitive and Shareholder-Relevant Takeaways

• Positive: Significant year-over-year growth in net income and net interest margin, as well as robust capital ratios, may support share price appreciation and increased investor confidence.
• Negative/Watch: Sequential declines in net income and liquidity, ongoing pressure on non-interest income, and higher provisions for credit losses could raise concerns about future earnings momentum and potential credit quality issues.
• Capital Return: The company paid \$0.3 million in preferred share dividends in Q1 2026.
• Book Value Accretion: Book value per share continues to rise, providing a solid foundation for valuation.
• Deep Impact Lending: Outperformance in community-focused lending under ECIP could improve the company’s regulatory profile and public image.

Detailed Financial Table Snapshots

• Interest and Dividend Income: \$48.7 million in Q1 2026, up 10.60% year-over-year.
• Interest Expense: \$20.4 million, down 6.23% year-over-year, despite higher deposit rates.
• Net Interest Income: \$28.2 million, up 27.13% year-over-year.
• Non-Interest Income: \$2.0 million, down from \$2.4 million in Q1 2025 due mainly to reduced SBA loan sales and grant income.
• Non-Interest Expense: \$17.2 million, up 2.08% year-over-year, with increases in marketing and operating costs.
• Provision for Income Taxes: \$2.7 million, up 35.95% year-over-year.
• Shares Outstanding (Diluted): 23.33 million.
• Earnings Per Share (Diluted): \$0.36, up 44% year-over-year.

Forward-Looking Statements

The company cautions that forward-looking statements in the release are subject to risks including interest rate volatility, economic conditions, competition, regulatory changes, and credit quality trends. Investors should review the company’s filings with the SEC for a full list of risk factors.

Conclusion

Ponce Financial Group, Inc.’s first quarter 2026 results highlight significant core earnings growth, strong net interest margin expansion, prudent credit management, and a community-centric lending strategy. While some sequential metrics softened, the company’s robust capital foundation, rising book value, and exceptional deep impact lending performance under ECIP stand out as positive catalysts for investor sentiment. However, increased credit provisioning and declining non-interest income warrant close monitoring.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult professional advisors before making any investment decisions. Forward-looking statements are subject to known and unknown risks, and actual results may differ materially.

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