Kearny Financial Reports Q2 Fiscal 2026 Results with Expanded Net Interest Margin and Improved Credit Quality
KRNY sits 52% above its 52-week low of $5.445 on elevated volume (2.1× avg).
Summary
Kearny Financial Corp. reported flat diluted EPS of $0.15 for Q2 fiscal 2026, but demonstrated strong operational improvements including expanded net interest margin, increased pre-tax, pre-provision net revenue, and significantly reduced non-performing assets.
Key Events · Earnings and Guidance · KRNY
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Q2 Fiscal 2026 Financial Results
Reported net income of $9.4 million, or $0.15 per diluted share, for the quarter ended December 31, 2025, compared to $9.5 million, or $0.15 per diluted share, in the prior quarter.
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Net Interest Margin Expansion
Net interest margin expanded by 4 basis points to 2.14%, driven by lower costs on interest-bearing liabilities and reduced borrowings.
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Improved Credit Quality
Non-performing assets decreased by 20.6% to $51.3 million, or 0.67% of total assets, primarily due to the full repayment of a previously disclosed non-performing construction loan.
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Strong Deposit Growth and Reduced Borrowings
Total deposits increased by $79.7 million (1.4%), while borrowings decreased by $111.5 million (9.2%), strengthening the balance sheet and funding capacity.
Analysis · KRNY · Finance
Kearny Financial Corp. reported a slight decrease in net income but maintained diluted EPS at $0.15 for the second quarter of fiscal 2026. The report highlights strong operational improvements, including a 3.9% increase in pre-tax, pre-provision net revenue to $12.3 million and a 4 basis point expansion in net interest margin to 2.14%. Credit quality significantly improved, with non-performing assets decreasing by 20.6% to $51.3 million. The company also strengthened its funding profile by increasing total deposits by $79.7 million and reducing borrowings by $111.5 million. These underlying operational and credit quality improvements are positive indicators for the bank's financial health and future profitability, despite the flat headline earnings.
At the time of this filing, KRNY was trading at $8.26 on NASDAQ in the Finance sector, with a market capitalization of approximately $534.7M. The 52-week trading range was $5.45 to $8.30. This filing was assessed with positive market sentiment and an importance score of 7 out of 10.