Five Star Bancorp Reports Q2 2026 Net Income of $19.4M, EPS $0.91; Loan Growth Accelerates but NIM Compresses
FSBC sits 71% above its 52-week low of $28.34.
Summary
Five Star Bancorp posted Q2 2026 net income of $19.4 million ($0.91 EPS), driven by 7% sequential loan and deposit growth. Net interest margin compressed to 3.63%, and nonperforming loans rose to 0.30% due to one large CRA credit.
Key Events · Earnings and Guidance · FSBC
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Q2 Net Income Rises to $19.4M
Net income of $19.4 million, or $0.91 per diluted share, up from $18.6 million ($0.87) in Q1 2026 and $14.5 million ($0.68) in Q2 2025.
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Loan and Deposit Growth Accelerates
Loans held for investment increased $306.3 million (7.27%) sequentially to $4.52 billion; total deposits grew $330.0 million (7.38%) to $4.80 billion, driven by non-wholesale deposit inflows.
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Net Interest Margin Compresses 7 bps
NIM declined to 3.63% from 3.70% in Q1 2026, as rapid balance sheet expansion diluted the overall yield on earning assets, though NIM remains 10 bps above the year-ago quarter.
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Nonperforming Loans Spike on Single CRA Credit
Nonperforming loans to loans held for investment rose to 0.30% from 0.07% in Q1 2026, driven by an $11.4 million Community Reinvestment Act loan placed on non-accrual status.
Analysis · FSBC · Finance
Five Star Bancorp delivered another quarter of strong organic growth, with net income rising to $19.4 million and EPS of $0.91, both up sequentially and year-over-year. The balance sheet expanded rapidly — loans grew 7% and deposits 7% from Q1 — but the net interest margin compressed 7 basis points to 3.63% as volume-driven growth diluted earning-asset yields. A single $11.4 million CRA loan moved to non-accrual, pushing nonperforming loans to 0.30% of the portfolio, a notable uptick from 0.07% last quarter. The efficiency ratio also ticked up to 40.91% from 38.57%, reflecting higher operating expenses tied to expansion. Capital ratios remain well above regulatory minimums, and the board declared another $0.25 quarterly dividend. The results reinforce the bank's growth trajectory but introduce modest margin and credit quality headwinds to monitor.
At the time of this filing, FSBC was trading at $48.37 on NASDAQ in the Finance sector, with a market capitalization of approximately $1B. The 52-week trading range was $28.34 to $50.26. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.