NB Bancorp, Inc., the holding company of Needham Bank, reported second quarter 2026 financial results, posting net income of $21.1 million, or $0.53 per diluted common share, compared to $15.0 million, or $0.36 per diluted common share, in the prior quarter. Operating net income (non-GAAP), which excludes one-time charges, amounted to $21.9 million, or $0.55 per diluted common share — beating the analyst consensus estimate of $0.47 by 14.58%. Total revenue for the quarter reached $74.704 million, surpassing the analyst consensus estimate of $72.734 million by 2.71%, and rising significantly from $51.285 million in the same period of the prior year.

Key Financial Highlights

The following table summarizes NB Bancorp's Q2 2026 performance compared to the prior quarter and the same period of the prior year:

Profitability and Efficiency

Key profitability metrics improved meaningfully during the quarter. Return on average assets rose to 1.17% from 0.87% in the prior quarter, while operating return on average assets (non-GAAP) increased to 1.21% from 0.92%. Return on average shareholders' equity improved to 10.03% from 7.05%, and the operating return on average equity (non-GAAP) reached 10.39% versus 7.43% in the prior quarter. The efficiency ratio improved to 58.92% from 61.55%, while the operating efficiency ratio (non-GAAP) improved to 57.66% from 60.06%. Net interest margin expanded by 7 basis points to 4.00% from 3.93% in the prior quarter, driven by loan growth and favorable rate dynamics. Net interest income increased $4.3 million, or 6.6%, to $69.1 million. Noninterest income rose $1.0 million, or 23.2%, to $5.6 million, supported by higher customer service fees, other income, and a net gain on loan sales.

Balance Sheet and Deposits

Total assets as of June 30, 2026 amounted to $7.45 billion, an increase of $220.2 million, or 3.0%, from $7.23 billion at March 31, 2026. The following table outlines key balance sheet figures:

Gross loans increased $213.0 million, or 3.4%, to $6.42 billion during the quarter. Total deposits increased $222.9 million, or 3.7%, to $6.32 billion. Core deposits rose $73.1 million, or 1.3%, to $5.60 billion, while brokered deposits increased $149.8 million, or 26.3%, to $719.9 million. Cash and cash equivalents increased $24.6 million, or 6.5%, to $400.2 million. Shareholders' equity decreased $776 thousand, or 0.1%, to $842.0 million, primarily due to the repurchase of 918,727 shares at an all-in weighted average cost of $20.13 per share totaling $18.5 million and $3.1 million in dividends paid, partially offset by net income of $21.1 million.

Asset Quality

Credit quality improved significantly during the quarter. The allowance for credit losses (ACL) stood at $82.1 million, or 1.28% of total loans, as of June 30, 2026, compared to $80.2 million, or 1.29%, at March 31, 2026. Non-performing loans (NPLs) decreased $17.9 million, or 39.3%, to $27.7 million, with the ACL as a percent of NPLs rising to 297% from 176% in the prior quarter. The following table summarizes key asset quality metrics:

Net charge-offs for the quarter totaled $1.1 million, or 0.07% of average total loans on an annualized basis, a sharp improvement from $13.6 million, or 0.91%, in the prior quarter. The decline was primarily attributable to prior quarter charge-offs on previously fully reserved purchase-credit-deteriorated (PCD) commercial and industrial loans from the BankProv acquisition.

Commercial Real Estate Portfolio

Commercial real estate loans increased $226.2 million, or 9.2%, to $2.69 billion during the quarter. The multi-family real estate portfolio increased $29.6 million, or 5.5%, to $567.7 million, consisting of properties primarily in the Greater Boston area. The cannabis facility commercial real estate portfolio decreased $3.7 million, or 1.7%, to $210.1 million, with all loan relationships current at quarter-end. The office portfolio stood at $335.7 million, consisting principally of suburban Class A and B office space used as medical and traditional offices, all performing at quarter-end.

Dividend Declaration

The Board of Directors declared a quarterly cash dividend of $0.07 per share, payable on August 19, 2026, to shareholders of record as of August 5, 2026.

Management Commentary

Management noted that through the first half of 2026, total loans and total deposits have increased by 15.0% and 15.9% on an annualized basis, respectively, while operating EPS increased 24%. The company highlighted targeted investments in artificial intelligence, improved internal systems, and automation tools designed to enhance internal efficiency, scalability, and employee effectiveness as part of its strategy for disciplined growth.