GELT Bancorp, Inc. Announces Second Quarter 2026 Operating Results

GELT Bancorp, Inc. (the "Company"), the holding company for Bank of Bird-in-Hand (the "Bank"), announced unaudited operating results for the three and six-months ended June 30, 2026. For the three months ended June 30, 2026, net income totaled $5.5 million, or $0.68 per share, compared to $2.8 million, or $0.35 per share, for the three months ended June 30, 2025, an increase of $2.7 million. For the six months ended June 30, 2026, net income totaled $10.3 million, or $1.29 per share, compared to net income of $5.2 million, or $0.66 per share, for the six months ended June 30, 2025, an increase of $5.1 million.

Annualized return on average assets and return on average equity for the quarter ended June 30, 2026 increased to 1.17% and 13.13%, respectively, compared to 0.68% and 7.32%, respectively, for the second quarter of 2025.

Lori A. Maley, CPA, President, Chief Executive Officer and Vice Chairman of the Board stated, "We are very pleased to report another record quarter of strong organic loan growth of 15.5%, supported by growth in core deposits of 19.8% year over year. This exceptional financial performance reflects the dedication of our team and the successful execution of our core business strategies serving our local communities. This momentum, driven by disciplined balance sheet management, resulted in record performance for the Bank with 96% growth in net income year over year. Furthermore, our profitability metrics improved significantly with annualized growth in net interest margin of 52 basis points year over year. These results demonstrate our ability to drive sustained, profitable growth and create long-term value for our shareholders."

Highlights for the second quarter of 2026, included: • Net income growth of 95.9% compared to prior year quarter and 12.7% over prior quarter.

• Total loans of $1.74 billion at June 30, 2026, increased $129.1 million, or 8.0%, from December 31, 2025.

• Total deposits grew $105.2 million, or 6.7%, from December 31, 2025 to $1.68 billion.

• Net interest margin expanded 11 basis points over prior quarter to 3.29%.

• Book value per share grew 3.30% to $21.00 during the second quarter.

• Continued strong asset quality, with nonperforming loans of 0.19% of total loans at June 30, 2026.

Results of Operations

Net interest income increased $4.0 million, or 36.3%, to $14.9 million for the second quarter of 2026, compared to $10.9 million for the second quarter of 2025. Net interest margin increased 52 basis points to 3.29% during the second quarter of 2026, from 2.77% in the second quarter of 2025. The yield on interest-earning assets increased 17 basis points to 6.08%, primarily driven by an increase in loan yields to 6.24% in the second quarter of 2026 from 6.01% in the second quarter of 2025. During the same periods, the cost of interest-bearing liabilities decreased 37 basis points to 3.28%, primarily driven by a decrease in the cost of interest-bearing deposits to 3.22% in the second quarter of 2026 from 3.59% in the second quarter of 2025.

The provision for credit losses for the quarter ended June 30, 2026 was $337,000 compared to $978,000 for the quarter ended June 30, 2025. The prior year provision expense was higher primarily from the slowing of loan prepayment speeds that took place during that time period which has not been repeated in the current period. The allowance for credit losses to total gross loans was 0.61% in the second quarter of 2026, a decrease of one basis point from 0.62% in the fourth quarter of 2025.

Total other income increased $224,000, or 20.5%, to $1.3 million for the second quarter of 2026 compared to $1.1 million for the second quarter of 2025. The increase was primarily attributed to higher service charge income, driven by increased loan volume.

Noninterest expense increased $1.2 million, or 17.0%, to $8.5 million for the quarter ended June 30, 2026, from $7.3 million for the quarter ended June 30, 2025. The increase resulted primarily from increased salaries and employee benefit expense, relating to a larger employee base, data processing, and other operating expenses. The efficiency ratio for the second quarter of 2026 was 52.7%, compared to 60.8% for the second quarter of 2025. Year-to-date, the efficiency ratio was 53.8%, compared to 64.3% the same period in 2025.

Financial Condition

Total assets increased $116.8 million, or 6.5%, to $1.91 billion at June 30, 2026, from $1.79 billion at December 31, 2025. Total gross loans increased $129.1 million, or 8.0%, to $1.74 billion at June 30, 2026, from $1.61 billion at December 31, 2025. This increase reflects strong organic loan growth, particularly in the commercial and industrial, and agricultural portfolios. Total cash and cash equivalents decreased $13.0 million, or 9.0%, compared to December 31, 2025, reflecting strategic reinvestment in organic loan growth, while sustaining a strong on-balance sheet liquidity position.

Total deposits increased $105.2 million, or 6.7%, to $1.68 billion at June 30, 2026, from $1.58 billion at December 31, 2025. Deposit growth was primarily due to our team's success in attracting new deposit relationships while also maintaining existing balances amid heightened industry-wide pricing competition. Compared to December 31, 2025, interest-bearing demand deposits increased $148.2 million, or 18.8%. and certificates of deposit decreased $47.3 million, or 7.3%, reflecting an intentional shift in deposit mix away from higher costing maturity deposits. Noninterest-bearing demand deposits increased $4.2 million, or 3.0%, to $145.8 million at June 30, 2026 from $141.5 million at December 31, 2025.

Total stockholders' equity increased $7.6 million, or 4.7%, to $168.0 million at June 30, 2026 from $160.4 million at year-end 2025. This growth was driven by strong net income, which more than offset a $0.35 per share common stock dividend which was paid in April 2026. Book value per share climbed to $21.00, a $1.91 increase from December 31, 2025.

Bank of Bird-in-Hand continues to maintain regulatory capital levels in excess of statutory well capitalized thresholds. As of June 30, 2026, our Tier 1 leverage ratio stood at 9.82%, Tier 1 capital ratio of 10.76%, and a Total capital ratio of 11.39%, providing a solid foundation to support organic loan growth, navigate shifting economic cycles, and continue serving the financial need of our community.

Asset Quality

The Company's overall asset quality remained strong during the second quarter of 2026. Total non-performing loans were $3.3 million, or 0.19% of total loans, at June 30, 2026, compared to $3.0 million, or 0.19% of total loans, at December 31, 2025. The allowance for credit losses represented 322.6% of nonperforming loans at June 30, 2026, compared to 331.4% at December 31, 2025. Management believes that the overall credit quality metrics of the Bank's loan portfolio are sound and remain within historical ranges.