RBB Bancorp Roars into Q3 with Strong Earnings, Loan Growth, and Improved Credit Quality
RBB Bancorp, a leading regional bank holding company, has reported a strong third quarter of 2026, showcasing significant improvements in its earnings power, loan growth, and credit quality. In a recent conference call, President and CEO Johnny Lee shared the company's impressive results, which demonstrate RBB's continued progress over the past two years.
Net income increased by 25% from the prior quarter to $12.6 million, or $0.74 per share, with a return on average assets (ROAA) of 1.17%. These results were driven by higher net interest income, solid loan growth, and continued improvement in credit quality. Notably, earnings per share have increased by 90% compared to the third quarter of 2024, while ROAA has improved by 63%, and return on average tangible common equity (ROATCE) has improved by 69%. For the nine months of the year, diluted earnings per share are up 60% from the same period last year.
Loan growth returned in the third quarter, with loans held for investment increasing $90 million, or 11% annualized, driven by steady origination volume and lower payoffs and loan sales. The company also completed its first full quarter of operations at its new Loan Production Office (LPO) in the San Francisco Bay Area, demonstrating its expansion into new markets.
Credit quality continued to improve, with non-performing assets declining 11% during the quarter. Over the past two years, non-performing assets are down 36%, while criticized and classified loans have decreased by 48%. The company has also made progress in resolving its only Off-Rolling Equity (OREO) property, which migrated from a non-performing loan last quarter.
On the funding side, retail deposit growth of $63 million allowed RBB to reduce wholesale deposits by $59 million, resulting in wholesale funding now representing less than 2% of total deposits. The company has also grown savings, NOW, and money market balances by 86% while reducing its cost of interest-bearing deposits by more than 100 basis points.
RBB's capital position remains strong, with the partial redemption of sub-debt and continued share repurchases under its buyback program. Over the past two years, tangible book value per share has increased by 11%, while shares outstanding have declined by 5%.
In conclusion, RBB Bancorp's strong third quarter results demonstrate the company's progress in improving its earning power and positioning itself for success as it heads into the end of 2026. With a solid track record of loan growth, credit quality improvement, and capital management, RBB is well-equipped to navigate the evolving banking landscape.
