Bridgewater Bancshares Surpasses 1% ROA Milestone, Reports Strong Q2 2026 Earnings
The second quarter earnings call for Bridgewater Bancshares was marked by excitement and optimism as the company reported a strong set of financial results. In his opening remarks, Jerry Baack, Chairman and CEO, highlighted the key highlights from the quarter, including another strong quarter with continued market share growth, improved profitability, and tangible book value expansion.
One of the standout achievements was the surpassing of a 1% Return on Assets (ROA) milestone for the first time since early 2023. This was largely driven by continued net interest margin expansion and net interest income growth, with net interest income rising an impressive 21% annualized in the second quarter.
Net interest margin expansion was a key driver of the company's profitability, with a strong reputation for being the employer of choice resulting in added talent to their team. This included several opportunistic hires, taking full advantage of market disruption in the Twin Cities, which led to some elevated personnel expenses as talent became available earlier than expected.
Year-to-date, Bridgewater has added 15 key hires from competitor banks that have recently been acquired, with these additions supporting future scaling, strengthening their ability to serve clients, and creating long-term value for shareholders. The company remained disciplined in its approach to growth, focusing on profitability as they grew the balance sheet.
Asset quality was a strength of the quarter once again, with minimal net charge-offs and a modest uptick in non-performing assets, but stabilization across watch, special mention, and substandard loans. Bridgewater continued to build capital through retained earnings, increasing its Common Equity Tier 1 (CET1) ratio by eight basis points to 9.61%.
Additionally, the company took advantage of a weighted average price of just $18 to repurchase approximately $700,000 of common stock during the past quarter. The strong Q2 results were capped off with improved efficiency ratios due to overall revenue growth momentum.
