Wider Margins Lift Arrow Financial Q2 Earnings; Adirondack Merger Closes July 1
AROW sits 55% above its 52-week low of $25.88 on light trading volume (0.1× avg).
Summary
Arrow Financial posted Q2 2026 net income of $11.0M ($0.66/share) as the net interest margin expanded to 3.42%. The Adirondack Bancorp acquisition closed on July 1, 2026, adding $942M in assets.
Key Events · Earnings and Guidance · AROW
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Q2 Net Income Rises 1.5%
Net income reached $11.0M, or $0.66 per diluted share, compared with $10.8M, or $0.65 per share, in Q2 2025. A 10.4% increase in net interest income to $35.9M reflected loan growth and higher yields.
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Net Interest Margin Expands 27 bps
The net interest margin climbed to 3.42% from 3.15% a year ago, as earning asset yields rose 12 basis points and the cost of interest-bearing liabilities fell 19 basis points. Lower funding costs were aided by the shift from brokered CDs to FHLB advances.
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$1.6M Specific Loan Loss Reserve
The provision for credit losses jumped to $2.8M from $0.6M in Q2 2025, largely due to a $1.6M specific reserve on a non-performing commercial loan. The reserve stems from a sudden personal and corporate bankruptcy declared in June 2026.
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Adirondack Merger Closes July 1
The $101M acquisition of Adirondack Bancorp closed on July 1, 2026, adding approximately $942M in assets, $848M in deposits, and 20 branches. Arrow issued 1.98M shares and paid $19.9M in cash, with integration expected later in 2026.
Analysis · AROW · Finance
A 10.4% surge in net interest income powered Arrow Financial's Q2 2026 net income to $11.0M, up 1.5% from a year ago, as the net interest margin widened 27 basis points to 3.42%. The quarter absorbed $1.0M in merger-related costs and a $1.6M specific loan loss reserve triggered by a sudden bankruptcy. On the funding side, a strategic pivot replaced $300M of higher-cost brokered CDs with FHLB advances, easing funding costs. Most notably, the Adirondack Bancorp acquisition closed on July 1, 2026, bringing $942M in assets and 20 branches—a transformative deal that will reshape the company's footprint and earnings profile going forward.
How filings like this one have moved
In the 30 days to Sep 20, 2026, 29.4% of the 1574 measured filings Wiseek scored 7 moved their stock by 5% or more by the next session's close. The median move was -0.43%. These are measured outcomes after filings of this importance, not a forecast for this one.
Measured one observation per ticker per day, after exclusions. Current figures: Filing Impact Tracker · open dataset
At the time of this filing, AROW was trading at $40.20 on NASDAQ in the Finance sector, with a market capitalization of approximately $664.5M. The 52-week trading range was $25.88 to $42.70. This filing was assessed with positive market sentiment and an importance score of 7 out of 10.