Unity Bancorp Inc.

01/13/2026 | Press release | Distributed by Public on 01/13/2026 05:05

Business/Financial Results (Form 8-K)

During the quarter, we also recognized a pre-tax unrealized gain of $1.5 million, related to the continued resolution of Patriot National Bancorp, Inc. Excluding this item, on a core basis, for the quarter, Unity earned $14.4 million, or $1.41 per diluted share, representing a 2.04% ROA and 16.77% ROE.

As we look ahead to 2026, Unity remains focused on delivering exceptional customer experiences, deepening relationships, and attracting new customers to the franchise. These priorities position us well to sustain our momentum and continue creating long-term value for our shareholders."

Clinton, NJ -- Unity Bancorp, Inc. (NASDAQ: UNTY), parent company of Unity Bank, reported net income of $15.5 million, or $1.52 per diluted share, for the quarter ended December 31, 2025, compared to net income of $14.4 million, or $1.41 per diluted share for the quarter ended September 30, 2025. For the twelve months ended December 31, 2025, Unity Bancorp reported net income of $58.0 million, or $5.67 per diluted share, compared to net income of $41.5 million, or $4.06 per diluted share, for the twelve months ended December 31, 2024.

Fourth Quarter Earnings Highlights

● Net interest income, the primary driver of earnings, was $31.4 million for the quarter ended December 31, 2025, an increase of $1.5 million, as compared to $29.9 million for the quarter ended September 30, 2025. Net interest margin ("NIM") increased 6 basis points to 4.60% for the quarter ended December 31, 2025, compared to the quarter ended September 30, 2025. The increase was primarily due to the declining rate on interest bearing liabilities.
● The provision for credit losses on loans was $2.2 million for the quarter ended December 31, 2025, compared to $1.4 million for the quarter ended September 30, 2025. The provision in the current quarter was primarily driven by loan growth, with additional increases in qualitative adjustments due to increased nonaccrual assets.
● Noninterest income was $3.9 million for the quarter ended December 31, 2025, compared to $3.0 million for the quarter ended September 30, 2025. The $0.9 million increase was primarily due to the substantial unrealized gain associated with Patriot. This was partially offset by lower gain on sale of mortgages.
o During the quarter ended September 30, 2025, Unity converted its debt security issued by Patriot National Bancorp, Inc. into common stock, resulting in ownership of approximately 2.673 million restricted Patriot shares valued at $0.75 per share. These shares remained restricted as of December 31, 2025, pending Patriot's registration of the shares or the availability of an applicable exemption and their eligibility for trading on a national securities exchange. During the quarter ended December 31, 2025, Unity marked the security to $1.30 per share, resulting in a $1.5 million unrealized gain on the Patriot position.
● Noninterest expense was $13.3 million for the quarter ended December 31, 2025, compared to $13.4 million for the quarter ended September 30, 2025. The decrease was primarily due to lower compensation and benefits expenses, partially offset by increases in loan related expenses, professional services and other expenses. Compensation and benefits expenses declined quarter over quarter due to $0.7 million of one-time accrual reversals.
● The effective tax rate was 21.4% for the quarter ended December 31, 2025, compared to 23.7% for the quarter ended September 30, 2025. During the fourth quarter of 2025, Unity purchased $8.0 million of federal tax credits for $7.5 million, resulting in $0.5 million of tax savings. The Company intends to evaluate other tax credit opportunities on an ongoing basis, subject to market availability and regulatory considerations.

Balance Sheet Highlights

● Total gross loans increased $284.1 million, or 12.6%, from December 31, 2024, primarily due to increases in the commercial, residential mortgage, and commercial construction loan categories. Furthermore, gross loans increased $76.2 million, or 3.1% from September 30, 2025.
● As of December 31, 2025, the allowance for credit losses as a percentage of gross loans was 1.27%.
● Total deposits increased $223.7 million, or 10.7%, from December 31, 2024. Further, total deposits increased $56.6 million, or 2.5% from September 30, 2025. As of December 31, 2025, uninsured or uncollateralized deposits represented 21.7% of total deposits. The Company's deposit composition as of December 31, 2025, consisted of 20.0% in noninterest bearing demand deposits, 17.5% in interest-bearing demand deposits, 24.4% in savings deposits and 38.1% in time deposits.
● As of December 31, 2025, investments comprised 4.2% of total assets. Available for sale debt securities ("AFS") were $70.9 million or 2.4% of total assets. Held to maturity ("HTM") debt securities were $36.6 million or 1.2% of total assets. As of December 31, 2025, pre-tax net unrealized losses on AFS and HTM were $1.6 million and $6.2 million, respectively. Equity securities were $16.6 million or 0.6% of total assets as of December 31, 2025.
● Borrowed funds increased $35.3 million from December 31, 2024. Borrowed funds were entirely comprised of borrowings from the FHLB.
● Shareholders' equity was $345.6 million as of December 31, 2025, compared to $295.6 million as of December 31, 2024. The $50.0 million increase was primarily driven by 2025 earnings, partially offset by dividend payments and share repurchase activity. During the quarter ended December 31, 2025, Unity Bancorp, Inc. repurchased 66,296 shares at a weighted average price of $46.55 per share. For the year ended December 31, 2025, Unity Bancorp, Inc. repurchased 116,296 shares at a weighted average price of $43.21 per share. During the quarter ended December 31, 2025, Unity Bancorp, Inc. retired approximately 1.6 million shares of treasury stock, valued at $35.5 million. The retired shares were returned to the pool of authorized but not issued shares.
● Book value per common share was $34.63 as of December 31, 2025, compared to $29.48 as of December 31, 2024. This increase primarily reflects retained earnings offset partially by dividends and share repurchases.
● Below is a summary of Unity Bancorp's regulatory capital ratios:
o The Leverage Ratio increased 50 basis points to 12.72% at December 31, 2025, compared to 12.22% at December 31, 2024.
o The Common Equity Tier 1 Capital Ratio increased 55 basis points to 14.45% at December 31, 2025, compared to 13.90% at December 31, 2024.
o The Tier 1 Capital Ratio increased 50 basis points to 14.87% at December 31, 2025, compared to 14.37% at December 31, 2024.
o The Total Capital Ratio increased 50 basis points, to 16.12% at December 31, 2025, compared to 15.62% at December 31, 2024.
● At December 31, 2025, the Company held $216.5 million of cash and cash equivalents. The Company also maintained approximately $499.2 million of funding available from various sources, including the FHLB, FRB Discount Window and other lines of credit. Total available funding plus cash on hand represented 142.1% of uninsured or uncollateralized deposits.
● As of December 31, 2025, nonaccrual assets (including OREO) were $31.3 million, compared to $20.5 million as of September 30, 2025. The ratio of nonaccrual loans to total loans was 1.17% as of December 31, 2025. The ratio of nonaccrual assets to total assets was 1.06% as of December 31, 2025. The increase primarily reflects one $15.5 million well-secured commercial real estate relationship that migrated to nonaccrual status during the quarter.

Other Highlights

❖ Effective as of January 1, 2026, George Boyan was promoted to President. Mr. Boyan previously served as Executive Vice President and Chief Financial Officer, where he played a pivotal role in the Company's financial strategy and growth. In addition to his new role as President, Mr. Boyan was appointed to the Boards of Directors of both Unity Bancorp, Inc. and Unity Bank, also effective January 1, 2026. James Davies will succeed Mr. Boyan as Chief Financial Officer.
❖ In December 2025, Unity Bancorp, Inc. was named to Piper Sandler's Sm-All Stars Class of 2025, a prestigious designation recognizing the top-performing small-cap banks and thrifts in the nation.

Unity Bancorp, Inc. is a financial services organization headquartered in Clinton, New Jersey, with approximately $3.0 billion in assets and $2.3 billion in deposits. Unity Bank, the Company's wholly owned subsidiary, provides financial services to retail, corporate and small business customers through its robust branch network located in Bergen, Hunterdon, Middlesex, Morris, Ocean, Somerset, Union and Warren Counties in New Jersey and Northampton County in Pennsylvania. For additional information about Unity, visit our website at www.unitybank.com , or call 800-618-BANK.

This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements may be identified by use of the words "believe", "expect", "intend", "anticipate", "estimate", "project" or similar expressions. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the Company's control that could impede its ability to achieve these goals. These factors include those items included in our Annual Report on Form 10-K under the heading "Item IA-Risk Factors" as amended or supplemented by our subsequent filings with the SEC, as well as general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, our ability to manage and reduce the level of our nonperforming assets, results of regulatory exams, the impact of any health crisis or national disasters on the Bank, its employees and customers, and the impact of uncertain or changing political conditions or any current or future federal government shutdown and uncertainty regarding the federal government's debt limit or changes in fiscal, monetary, trade or regulatory policy, among other factors.

UNITY BANCORP, INC.

SUMMARY FINANCIAL HIGHLIGHTS

December 31, 2025 vs.

September 30, 2025

December 31, 2024

(In thousands, except percentages and per share amounts)

December 31, 2025

September 30, 2025

December 31, 2024

%

%

BALANCE SHEET DATA

Total assets

$

2,966,652

$

2,876,365

$

2,654,017

3.1

%

11.8

%

Total deposits

2,324,061

2,267,484

2,100,313

2.5

10.7

Total gross loans

2,544,713

2,468,527

2,260,657

3.1

12.6

Total securities

124,015

131,252

145,028

(5.5)

(14.5)

Total shareholders' equity

345,631

334,023

295,583

3.5

16.9

Allowance for credit losses

32,342

30,245

26,788

6.9

20.7

FINANCIAL DATA - QUARTER TO DATE

Income before provision for income taxes

$

19,694

$

18,866

$

14,489

4.4

35.9

Provision for income taxes

4,222

4,476

2,984

(5.7)

41.5

Net income

$

15,472

$

14,390

$

11,505

7.5

34.5

Net income per common share - Basic

$

1.55

$

1.43

$

1.15

8.4

34.8

Net income per common share - Diluted

1.52

1.41

1.13

7.8

34.5

PERFORMANCE RATIOS - QUARTER TO DATE (ANNUALIZED)

Return on average assets

2.20

%

2.11

%

1.83

%

Return on average equity

18.08

17.41

15.77

Efficiency ratio**

39.52

41.47

44.44

Cost of funds

2.38

2.46

2.51

Net interest margin

4.60

4.54

4.37

Noninterest expense to average assets

1.89

1.97

2.01

FINANCIAL DATA - YEAR TO DATE

Income before provision for income taxes

$

75,512

$

54,390

38.8

Provision for income taxes

17,561

12,940

35.7

Net income

$

57,951

$

41,450

39.8

Net income per common share - Basic

$

5.78

$

4.13

40.0

Net income per common share - Diluted

5.67

4.06

39.7

PERFORMANCE RATIOS - YEAR TO DATE

Return on average assets

2.17

%

1.68

%

Return on average equity

18.07

14.99

Efficiency ratio**

41.48

45.77

Cost of funds

2.44

2.65

Net interest margin

4.52

4.16

Noninterest expense to average assets

1.96

1.98

SHARE INFORMATION

Market price per share

$

51.72

$

48.87

$

43.61

5.8

18.6

Dividends paid (QTD)

0.15

0.15

0.13

-

15.4

Book value per common share

34.63

33.26

29.48

4.1

17.5

Average diluted shares outstanding (QTD)

10,195

10,233

10,204

(0.4)

(0.1)

UNITY BANCORP CAPITAL RATIOS

Total equity to total assets

11.65

%

11.61

%

11.14

%

0.3

4.6

Leverage ratio

12.72

12.71

12.22

0.1

4.1

Common Equity Tier 1 Capital Ratio

14.45

14.45

13.90

-

4.0

Risk-based Tier 1 Capital Ratio

14.87

14.88

14.37

(0.1)

3.5

Risk-based Total Capital Ratio

16.12

16.13

15.62

(0.1)

3.2

CREDIT QUALITY AND RATIOS

Nonaccrual assets

$

31,308

$

20,514

$

15,046

52.6

108.1

QTD annualized net (chargeoffs) to QTD average loans

(0.02)

%

(0.03)

%

(0.12)

%

Allowance for credit losses to total loans

1.27

1.23

1.18

Nonaccrual loans to total loans

1.17

0.83

0.58

Nonaccrual assets to total assets

1.06

0.71

0.57

** The efficiency ratio is a non-GAAP measure, calculated based on the noninterest expense divided by the sum of net interest income plus non interest income, excluding net gains and losses on securities.

UNITY BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

December 31, 2025 vs.

September 30, 2025

December 31, 2024

(In thousands, except percentages)

December 31, 2025

September 30, 2025

December 31, 2024

%

%

ASSETS

Cash and due from banks

$

19,841

$

20,860

$

20,206

(4.9)

%

(1.8)

%

Interest-bearing deposits

196,678

182,626

160,232

7.7

22.7

Cash and cash equivalents

216,519

203,486

180,438

6.4

20.0

Securities:

Debt securities available for sale, at market value, net of valuation allowance

70,870

82,063

93,884

(13.6)

(24.5)

Debt securities held to maturity, at book value

36,576

36,505

41,294

0.2

(11.4)

Equity securities, at market value

16,569

12,684

9,850

30.6

68.2

Total securities

124,015

131,252

145,028

(5.5)

(14.5)

Loans:

Loans held for sale

9,490

15,421

12,163

(38.5)

(22.0)

SBA loans held for investment

34,259

37,537

38,309

(8.7)

(10.6)

Commercial loans

1,518,032

1,465,497

1,281,436

3.6

18.5

Commercial construction loans

147,215

117,111

130,193

25.7

13.1

Residential mortgage loans

677,221

676,862

630,927

0.1

7.3

Consumer loans

85,219

82,857

76,711

2.9

11.1

Residential construction loans

73,277

73,242

90,918

-

(19.4)

Total loans

2,544,713

2,468,527

2,260,657

3.1

12.6

Allowance for credit losses

(32,342)

(30,245)

(26,788)

6.9

20.7

Net loans

2,512,371

2,438,282

2,233,869

3.0

12.5

Premises and equipment, net

18,022

18,439

18,778

(2.3)

(4.0)

Bank owned life insurance ("BOLI")

26,547

26,319

25,773

0.9

3.0

Deferred tax assets

14,640

15,022

14,106

(2.5)

3.8

Federal Home Loan Bank ("FHLB") stock

14,314

13,218

12,507

8.3

14.4

Accrued interest receivable

12,896

13,288

12,691

(3.0)

1.6

Goodwill

1,516

1,516

1,516

-

-

Other real estate owned ("OREO")

1,472

-

-

*NM

*NM

Prepaid expenses and other assets

24,340

15,543

9,311

56.6

161.4

Total assets

$

2,966,652

$

2,876,365

$

2,654,017

3.1

%

11.8

%

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:

Deposits:

Noninterest-bearing demand

$

465,596

$

447,510

$

440,803

4.0

%

5.6

%

Interest-bearing demand

369,131

362,449

321,780

1.8

14.7

Savings

535,044

535,560

491,175

(0.1)

8.9

Brokered deposits

274,203

235,122

217,931

16.6

25.8

Time deposits

680,087

686,843

628,624

(1.0)

8.2

Total deposits

2,324,061

2,267,484

2,100,313

2.5

10.7

Borrowed funds

255,774

231,707

220,504

10.4

16.0

Subordinated debentures

10,310

10,310

10,310

-

-

Accrued interest payable

2,138

1,790

1,702

19.4

25.6

Accrued expenses and other liabilities

28,738

31,051

25,605

(7.4)

12.2

Total liabilities

2,621,021

2,542,342

2,358,434

3.1

11.1

Shareholders' equity:

Common stock

105,892

105,320

103,936

0.5

1.9

Retained earnings

243,935

265,491

227,331

*NM

7.3

Treasury stock, at cost

(3,101)

(35,515)

(33,577)

*NM

(90.8)

Accumulated other comprehensive loss

(1,095)

(1,273)

(2,107)

(14.0)

(48.0)

Total shareholders' equity

345,631

334,023

295,583

3.5

16.9

Total liabilities and shareholders' equity

$

2,966,652

$

2,876,365

$

2,654,017

3.1

%

11.8

%

Shares issued

10,048

11,681

11,616

Shares outstanding

9,982

10,041

10,026

Treasury shares

66

1,640

1,590

*NM=Not meaningful

UNITY BANCORP, INC.

QTD CONSOLIDATED STATEMENTS OF INCOME

December 31, 2025 vs.

For the three months ended

September 30, 2025

December 31, 2024

(In thousands, except percentages and per share amounts)

December 31, 2025

September 30, 2025

December 31, 2024

$

%

$

%

INTEREST INCOME

Interest-bearing deposits

$

674

$

472

$

484

$

202

42.8

%

$

190

39.3

%

FHLB stock

133

121

164

12

9.9

(31)

(18.9)

Securities:

Taxable

1,561

1,735

1,809

(174)

(10.0)

(248)

(13.7)

Tax-exempt

18

18

17

-

-

1

5.9

Total securities

1,579

1,753

1,826

(174)

(9.9)

(247)

(13.5)

Loans:

SBA loans

1,037

964

1,101

73

7.6

(64)

(5.8)

Commercial loans

25,626

24,853

20,310

773

3.1

5,316

26.2

Commercial construction loans

2,666

2,344

3,190

322

13.7

(524)

(16.4)

Residential mortgage loans

10,838

10,749

9,578

89

0.8

1,260

13.2

Consumer loans

1,524

1,469

1,379

55

3.7

145

10.5

Residential construction loans

1,791

1,636

2,232

155

9.5

(441)

(19.8)

Total loans

43,482

42,015

37,790

1,467

3.5

5,692

15.1

Total interest income

45,868

44,361

40,264

1,507

3.4

5,604

13.9

INTEREST EXPENSE

Interest-bearing demand deposits

2,009

1,998

1,653

11

0.6

356

21.5

Savings deposits

3,165

3,177

2,909

(12)

(0.4)

256

8.8

Brokered deposits

2,033

2,003

1,896

30

1.5

137

7.2

Time deposits

6,350

6,247

6,200

103

1.6

150

2.4

Borrowed funds and subordinated debentures

942

1,080

1,116

(138)

(12.8)

(174)

(15.6)

Total interest expense

14,499

14,505

13,774

(6)

-

725

5.3

Net interest income

31,369

29,856

26,490

1,513

5.1

4,879

18.4

Provision for credit losses, loans

2,208

1,409

470

799

56.7

1,738

369.8

Provision (release) for credit losses, off-balance sheet

50

(80)

(65)

130

*NM

115

*NM

(Release) provision of credit losses, securities

-

(787)

895

787

*NM

(895)

*NM

Net interest income after provision for credit losses

29,111

29,314

25,190

(203)

(0.7)

3,921

15.6

NONINTEREST INCOME

Branch fee income

475

450

463

25

5.6

12

2.6

Service and loan fee income

705

607

488

98

16.1

217

44.5

Gain on sale of SBA loans held for sale, net

165

238

47

(73)

(30.7)

118

251.1

Gain on sale of mortgage loans, net

343

582

353

(239)

(41.1)

(10)

(2.8)

BOLI income

228

211

155

17

8.1

73

47.1

Net securities gains

1,570

475

14

1,095

230.5

1,556

*NM

Other income

412

404

396

8

2.0

16

4.0

Total noninterest income

3,898

2,967

1,916

931

31.4

1,982

103.4

NONINTEREST EXPENSE

Compensation and benefits

7,693

8,430

7,997

(737)

(8.7)

(304)

(3.8)

Processing and communications

1,077

1,150

859

(73)

(6.3)

218

25.4

Occupancy

880

838

790

42

5.0

90

11.4

Furniture and equipment

854

838

834

16

1.9

20

2.4

Professional services

640

405

517

235

58.0

123

23.8

Advertising

379

456

348

(77)

(16.9)

31

8.9

Loan related expenses

426

151

179

275

182.1

247

138.0

Deposit insurance

300

320

195

(20)

(6.3)

105

53.8

Director fees

271

263

246

8

3.0

25

10.2

Other expenses

795

564

652

231

41.0

143

21.9

Total noninterest expense

13,315

13,415

12,617

(100)

(0.7)

698

5.5

Income before provision for income taxes

19,694

18,866

14,489

828

4.4

5,205

35.9

Provision for income taxes

4,222

4,476

2,984

(254)

(5.7)

1,238

41.5

Net income

$

15,472

$

14,390

$

11,505

$

1,082

7.5

%

$

3,967

34.5

%

Effective tax rate

21.4

%

23.7

%

20.6

%

Net income per common share - Basic

$

1.55

$

1.43

$

1.15

Net income per common share - Diluted

1.52

1.41

1.13

Weighted average common shares outstanding - Basic

10,008

10,036

10,002

Weighted average common shares outstanding - Diluted

10,195

10,233

10,204

*NM=Not meaningful

UNITY BANCORP, INC.

YTD CONSOLIDATED STATEMENTS OF INCOME

For the years ended December 31,

Current YTD vs. Prior YTD

(In thousands, except percentages and per share amounts)

2025

2024

$

%

INTEREST INCOME

Interest-bearing deposits

$

1,964

$

2,033

$

(69)

(3.4)

%

FHLB stock

565

789

(224)

(28.4)

Securities:

Taxable

6,818

7,312

(494)

(6.8)

Tax-exempt

71

70

1

1.4

Total securities

6,889

7,382

(493)

(6.7)

Loans:

SBA loans

3,790

4,887

(1,097)

(22.4)

Commercial loans

95,144

75,699

19,445

25.7

Commercial construction loans

10,340

12,074

(1,734)

(14.4)

Residential mortgage loans

41,925

37,770

4,155

11.0

Consumer loans

5,830

5,607

223

4.0

Residential construction loans

7,181

9,497

(2,316)

(24.4)

Total loans

164,210

145,534

18,676

12.8

Total interest income

173,628

155,738

17,890

11.5

INTEREST EXPENSE

Interest-bearing demand deposits

7,528

7,176

352

4.9

Savings deposits

11,652

13,006

(1,354)

(10.4)

Brokered deposits

7,608

8,412

(804)

(9.6)

Time deposits

25,571

22,918

2,653

11.6

Borrowed funds and subordinated debentures

4,236

5,615

(1,379)

(24.6)

Total interest expense

56,595

57,127

(532)

(0.9)

Net interest income

117,033

98,611

18,422

18.7

Provision for credit losses, loans

6,699

2,407

4,292

178.3

Provision for credit losses, off-balance sheet

66

1

65

*NM

(Release) Provision for credit losses, securities

(2,824)

1,541

*NM

*NM

Net interest income after provision for credit losses

113,092

94,662

18,430

19.5

NONINTEREST INCOME

Branch fee income

1,836

1,391

445

32.0

Service and loan fee income

2,712

2,165

547

25.3

Gain on sale of SBA loans held for sale, net

705

660

45

6.8

Gain on sale of mortgage loans, net

1,527

1,488

39

2.6

BOLI income

774

544

230

42.3

Net securities gains

5,596

586

5,010

*NM

Other income

1,629

1,635

(6)

(0.4)

Total noninterest income

14,779

8,469

6,310

74.5

NONINTEREST EXPENSE

Compensation and benefits

32,186

29,749

2,437

8.2

Processing and communications

4,193

3,473

720

20.7

Occupancy

3,407

3,184

223

7.0

Furniture and equipment

3,224

3,140

84

2.7

Professional services

1,758

1,683

75

4.5

Advertising

1,682

1,611

71

4.4

Loan related expenses

888

1,138

(250)

(22.0)

Deposit insurance

1,174

1,100

74

6.7

Director fees

1,293

956

337

35.3

Other expenses

2,554

2,707

(153)

(5.7)

Total noninterest expense

52,359

48,741

3,618

7.4

Income before provision for income taxes

75,512

54,390

21,122

38.8

Provision for income taxes

17,561

12,940

4,621

35.7

Net income

$

57,951

$

41,450

$

16,501

39.8

%

Effective tax rate

23.3

%

23.8

%

Net income per common share - Basic

$

5.78

$

4.13

Net income per common share - Diluted

5.67

4.06

Weighted average common shares outstanding - Basic

10,033

10,031

Weighted average common shares outstanding - Diluted

10,223

10,202

*NM=Not meaningful

UNITY BANCORP, INC.

QUARTER TO DATE NET INTEREST MARGIN

For the three months ended

(Dollar amounts in thousands, interest amounts and

December 31, 2025

December 31, 2024

interest rates/yields on a fully tax-equivalent basis)

Average Balance

Interest

Rate/Yield

Average Balance

Interest

Rate/Yield

ASSETS

Interest-earning assets:

Interest-bearing deposits

$

66,840

$

674

4.00

%

$

40,656

$

484

4.73

%

FHLB stock

6,859

133

7.67

7,303

164

8.96

Securities:

Taxable

128,384

1,561

4.86

142,096

1,809

5.09

Tax-exempt

1,474

21

5.67

1,588

17

4.47

Total securities (A)

129,858

1,582

4.87

143,684

1,826

5.09

Loans:

SBA loans

45,686

1,037

9.08

53,258

1,101

8.27

Commercial loans

1,487,472

25,626

6.74

1,233,532

20,310

6.44

Commercial construction loans

131,268

2,666

7.95

146,461

3,190

8.52

Residential mortgage loans

680,679

10,838

6.37

622,623

9,578

6.15

Consumer loans

84,318

1,524

7.07

73,087

1,379

7.39

Residential construction loans

74,915

1,791

9.35

92,648

2,232

9.43

Total loans (B)

2,504,338

43,482

6.79

2,221,609

37,790

6.66

Total interest-earning assets

$

2,707,895

$

45,871

6.72

%

$

2,413,252

$

40,264

6.64

%

Noninterest-earning assets:

Cash and due from banks

23,135

23,089

Allowance for credit losses

(30,791)

(27,292)

Other assets

91,977

92,772

Total noninterest-earning assets

84,321

88,569

Total assets

$

2,792,216

$

2,501,821

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:

Interest-bearing demand deposits

$

391,005

$

2,009

2.04

%

$

325,151

$

1,653

2.02

%

Savings deposits

546,025

3,165

2.30

510,725

2,909

2.27

Brokered deposits

231,956

2,033

3.48

218,755

1,896

3.45

Time deposits

687,058

6,350

3.67

579,519

6,200

4.26

Total interest-bearing deposits

1,856,044

13,557

2.90

1,634,150

12,658

3.08

Borrowed funds and subordinated debentures

100,689

942

3.66

115,314

1,116

3.79

Total interest-bearing liabilities

$

1,956,733

$

14,499

2.94

%

$

1,749,464

$

13,774

3.13

%

Noninterest-bearing liabilities:

Noninterest-bearing demand deposits

462,977

431,034

Other liabilities

33,026

31,032

Total noninterest-bearing liabilities

496,003

462,066

Total shareholders' equity

339,480

290,291

Total liabilities and shareholders' equity

$

2,792,216

$

2,501,821

Net interest spread

$

31,372

3.78

%

$

26,490

3.51

%

Tax-equivalent basis adjustment

(3)

-

Net interest income

$

31,369

$

26,490

Net interest margin

4.60

%

4.37

%

(A) Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductible portion of interest expense, assuming a federal tax rate of 21 percent and applicable state rates.
(B) The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued.

UNITY BANCORP, INC.

QUARTER TO DATE NET INTEREST MARGIN

For the three months ended

(Dollar amounts in thousands, interest amounts and

December 31, 2025

September 30, 2025

interest rates/yields on a fully tax-equivalent basis)

Average Balance

Interest

Rate/Yield

Average Balance

Interest

Rate/Yield

ASSETS

Interest-earning assets:

Interest-bearing deposits

$

66,840

$

674

4.00

%

$

42,014

$

472

4.46

%

FHLB stock

6,859

133

7.67

7,588

121

6.31

Securities:

Taxable

128,384

1,561

4.86

135,170

1,735

5.14

Tax-exempt

1,474

21

5.67

1,460

24

6.43

Total securities (A)

129,858

1,582

4.87

136,630

1,759

5.15

Loans:

SBA loans

45,686

1,037

9.08

46,001

964

8.38

Commercial loans

1,487,472

25,626

6.74

1,441,447

24,853

6.75

Commercial construction loans

131,268

2,666

7.95

111,015

2,344

8.26

Residential mortgage loans

680,679

10,838

6.37

674,260

10,749

6.38

Consumer loans

84,318

1,524

7.07

82,851

1,469

6.94

Residential construction loans

74,915

1,791

9.35

68,056

1,636

9.41

Total loans (B)

2,504,338

43,482

6.79

2,423,630

42,015

6.78

Total interest-earning assets

$

2,707,895

$

45,871

6.72

%

$

2,609,862

$

44,367

6.74

%

Noninterest-earning assets:

Cash and due from banks

23,135

23,335

Allowance for credit losses

(30,791)

(29,641)

Other assets

91,977

98,914

Total noninterest-earning assets

84,321

92,608

Total assets

$

2,792,216

$

2,702,470

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:

Interest-bearing demand deposits

$

391,005

$

2,009

2.04

%

$

363,353

$

1,998

2.18

%

Savings deposits

546,025

3,165

2.30

510,616

3,177

2.47

Brokered deposits

231,956

2,033

3.48

230,728

2,003

3.44

Time deposits

687,058

6,350

3.67

665,691

6,247

3.72

Total interest-bearing deposits

1,856,044

13,557

2.90

1,770,388

13,425

3.01

Borrowed funds and subordinated debentures

100,689

942

3.66

118,350

1,080

3.57

Total interest-bearing liabilities

$

1,956,733

$

14,499

2.94

%

$

1,888,738

$

14,505

3.05

%

Noninterest-bearing liabilities:

Noninterest-bearing demand deposits

462,977

453,140

Other liabilities

33,026

32,741

Total noninterest-bearing liabilities

496,003

485,881

Total shareholders' equity

339,480

327,851

Total liabilities and shareholders' equity

$

2,792,216

$

2,702,470

Net interest spread

$

31,372

3.78

%

$

29,862

3.69

%

Tax-equivalent basis adjustment

(3)

(6)

Net interest income

$

31,369

$

29,856

Net interest margin

4.60

%

4.54

%

(A) Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductible portion of interest expense, assuming a federal tax rate of 21 percent and applicable state rates.
(B) The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued.

UNITY BANCORP, INC.

YTD NET INTEREST MARGIN

For the years ended

(Dollar amounts in thousands, interest amounts and

December 31, 2025

December 31, 2024

interest rates/yields on a fully tax-equivalent basis)

Average Balance

Interest

Rate/Yield

Average Balance

Interest

Rate/Yield

ASSETS

Interest-earning assets:

Interest-bearing deposits

$

45,865

$

1,964

4.28

%

$

38,491

$

2,033

5.28

%

FHLB stock

7,382

565

7.66

8,440

789

9.34

Securities:

Taxable

136,129

6,818

5.01

139,800

7,312

5.23

Tax-exempt

1,499

83

5.55

1,599

72

4.49

Total securities (A)

137,628

6,901

5.01

141,399

7,384

5.22

Loans:

SBA loans

47,478

3,790

7.87

56,307

4,887

8.56

Commercial loans

1,405,106

95,144

6.68

1,186,277

75,699

6.28

Commercial construction loans

124,234

10,340

8.21

134,806

12,074

8.81

Residential mortgage loans

663,372

41,925

6.32

625,365

37,770

6.04

Consumer loans

81,177

5,830

7.08

71,010

5,607

7.77

Residential construction loans

74,933

7,181

9.45

108,558

9,497

8.61

Total loans (B)

2,396,300

164,210

6.76

2,182,323

145,534

6.56

Total interest-earning assets

$

2,587,175

$

173,640

6.71

%

$

2,370,653

$

155,740

6.57

%

Noninterest-earning assets:

Cash and due from banks

22,798

23,396

Allowance for credit losses

(28,999)

(26,492)

Other assets

94,422

92,687

Total noninterest-earning assets

88,221

89,591

Total assets

$

2,675,396

$

2,460,244

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:

Interest-bearing demand deposits

$

362,811

$

7,528

2.07

%

$

326,943

$

7,176

2.19

%

Savings deposits

509,892

11,652

2.29

512,405

13,006

2.54

Brokered deposits

220,910

7,608

3.44

227,070

8,412

3.70

Time deposits

668,405

25,571

3.83

535,297

22,918

4.28

Total interest-bearing deposits

1,762,018

52,359

2.97

1,601,715

51,512

3.22

Borrowed funds and subordinated debentures

114,047

4,236

3.66

141,489

5,615

3.90

Total interest-bearing liabilities

$

1,876,065

$

56,595

3.02

%

$

1,743,204

$

57,127

3.28

%

Noninterest-bearing liabilities:

Noninterest-bearing demand deposits

446,081

411,148

Other liabilities

32,524

29,421

Total noninterest-bearing liabilities

478,605

440,569

Total shareholders' equity

320,726

276,471

Total liabilities and shareholders' equity

$

2,675,396

$

2,460,244

Net interest spread

$

117,045

3.69

%

$

98,613

3.29

%

Tax-equivalent basis adjustment

(12)

(2)

Net interest income

$

117,033

$

98,611

Net interest margin

4.52

%

4.16

%

(A) Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductible portion of interest expense, assuming a federal tax rate of 21 percent and applicable state rates.

(B) The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued.

UNITY BANCORP, INC.

QUARTERLY ALLOWANCE FOR CREDIT LOSSES AND ASSET QUALITY SCHEDULES

Amounts in thousands, except percentages

December 31, 2025

September 30, 2025

June 30, 2025

March 31, 2025

December 31, 2024

ALLOWANCE FOR CREDIT LOSSES:

Balance, beginning of period

$

30,245

$

29,012

$

27,651

$

26,788

$

27,002

Provision for credit losses on loans

2,208

1,409

1,725

1,358

470

32,453

30,421

29,376

28,146

27,472

Less: Chargeoffs

SBA loans

265

211

105

350

300

Commercial loans

-

-

100

2

350

Residential mortgage loans

46

85

282

130

150

Consumer loans

11

30

21

50

93

Residential construction loans

-

-

-

-

-

Total chargeoffs

322

326

508

532

893

Add: Recoveries

SBA loans

4

50

2

5

26

Commercial loans

196

92

102

5

171

Residential mortgage loans

-

-

-

-

-

Consumer loans

11

8

40

27

12

Residential construction loans

-

-

-

-

-

Total recoveries

211

150

144

37

209

Net chargeoffs

(111)

(176)

(364)

(495)

(684)

Balance, end of period

$

32,342

$

30,245

$

29,012

$

27,651

$

26,788

ASSET QUALITY INFORMATION:

Nonaccrual loans:

SBA loans

$

1,751

$

4,225

$

4,177

$

3,231

$

3,850

Commercial loans

18,473

4,006

3,512

4,821

2,974

Residential mortgage loans

8,173

11,174

7,980

8,622

5,711

Consumer loans

1,268

938

-

-

-

Residential construction loans

171

171

171

171

547

Total nonaccrual loans

29,836

20,514

15,840

16,845

13,082

Debt securities available for sale, net of valuation allowance

-

-

-

1,145

1,964

OREO

1,472

-

-

-

-

Nonaccrual assets

31,308

20,514

15,840

17,990

15,046

Loans 90 days past due & still accruing

$

-

$

356

$

2,876

$

1,123

$

760

Nonaccrual loans to total loans

1.17

%

0.83

%

0.66

%

0.72

%

0.58

%

Nonaccrual assets to total assets

1.06

0.71

0.54

0.65

0.57

Allowance for credit losses to:

Total loans at quarter end

1.27

%

1.23

%

1.22

%

1.18

%

1.18

%

Total nonaccrual loans

108.40

147.44

183.16

164.15

204.77

UNITY BANCORP, INC.

QUARTERLY FINANCIAL DATA

(In thousands, except %'s, employee, office and per share amounts)

December 31, 2025

September 30, 2025

June 30, 2025

March 31, 2025

December 31, 2024

SUMMARY OF INCOME:

Total interest income

$

45,868

$

44,361

$

42,600

$

40,799

$

40,264

Total interest expense

14,499

14,505

14,043

13,548

13,774

Net interest income

31,369

29,856

28,557

27,251

26,490

Provision (Release) for credit losses

2,258

542

(175)

1,316

1,300

Net interest income after provision for credit losses

29,111

29,314

28,732

25,935

25,190

Total noninterest income

3,898

2,967

5,815

2,099

1,916

Total noninterest expense

13,315

13,415

13,019

12,610

12,617

Income before provision for income taxes

19,694

18,866

21,528

15,424

14,489

Provision for income taxes

4,222

4,476

5,037

3,826

2,984

Net income

$

15,472

$

14,390

$

16,491

$

11,598

$

11,505

Net income per common share - Basic

$

1.55

$

1.43

$

1.64

$

1.16

$

1.15

Net income per common share - Diluted

1.52

1.41

1.61

1.13

1.13

COMMON SHARE DATA:

Market price per share

$

51.72

$

48.87

$

47.08

$

40.70

$

43.61

Dividends paid

0.15

0.15

0.14

0.14

0.13

Book value per common share

34.63

33.26

31.88

30.38

29.48

Weighted average common shares outstanding - Basic

10,008

10,036

10,033

10,054

10,002

Weighted average common shares outstanding - Diluted

10,195

10,233

10,212

10,247

10,204

Issued common shares

10,048

11,681

11,672

11,666

11,616

Outstanding common shares

9,982

10,041

10,032

10,076

10,026

Treasury shares

66

1,640

1,640

1,590

1,590

QUARTERLY PERFORMANCE RATIOS (ANNUALIZED):

Return on average assets

2.20

%

2.11

%

2.51

%

1.83

%

1.83

%

Return on average equity

18.08

17.41

21.15

15.56

15.77

Efficiency ratio**

39.52

41.47

42.31

42.89

44.44

Noninterest expense to average assets

1.89

1.97

1.98

1.99

2.01

BALANCE SHEET DATA:

Total assets

$

2,966,652

$

2,876,365

$

2,928,523

$

2,767,943

$

2,654,017

Total securities

124,015

131,252

139,348

142,092

145,028

Total loans

2,544,713

2,468,527

2,382,594

2,345,130

2,260,657

Allowance for credit losses

32,342

30,245

29,012

27,651

26,788

Total deposits

2,324,061

2,267,484

2,187,366

2,175,398

2,100,313

Total shareholders' equity

345,631

334,023

319,840

306,142

295,583

TAX EQUIVALENT YIELDS AND RATES:

Interest-earning assets

6.72

%

6.74

%

6.70

%

6.68

%

6.64

%

Interest-bearing liabilities

2.94

3.05

3.05

3.04

3.13

Net interest spread

3.78

3.69

3.66

3.64

3.51

Net interest margin

4.60

4.54

4.49

4.46

4.37

CREDIT QUALITY:

Nonaccrual assets

$

31,308

$

20,514

$

15,840

$

17,990

$

15,046

QTD annualized net chargeoffs to QTD average loans

(0.02)

%

(0.03)

%

(0.06)

%

(0.09)

%

(0.12)

%

Allowance for credit losses to total loans

1.27

1.23

1.22

1.18

1.18

Nonaccrual loans to total loans

1.17

0.83

0.66

0.72

0.58

Nonaccrual assets to total assets

1.06

0.71

0.54

0.65

0.57

UNITY BANCORP CAPITAL RATIOS:

Total equity to total assets

11.65

%

11.61

%

10.92

%

11.06

%

11.14

%

Leverage ratio

12.72

12.71

12.50

12.32

12.22

Common Equity Tier 1 Capital Ratio

14.45

14.45

13.96

13.87

13.90

Risk-based Tier 1 Capital Ratio

14.87

14.88

14.39

14.33

14.37

Risk-based Total Capital Ratio

16.12

16.13

15.65

15.58

15.62

Number of banking offices

22

22

21

21

21

Employee Full-Time Equivalent

242

238

237

227

224

** The efficiency ratio is a non-GAAP measure, calculated based on the noninterest expense divided by the sum of net interest income plus non interest income, excluding net gains and losses on securities.

UNITY BANCORP, INC.

LOAN PORTFOLIO COMPOSITION

In thousands, except percentages

December 31, 2025

%

December 31, 2024

%

Loans Held for Sale

$

9,490

0.4%

$

12,163

0.5%

SBA Loans

34,259

1.3%

38,309

1.7%

Commercial Loans

SBA 504

43,802

1.7%

48,479

2.1%

Commercial & industrial

183,163

7.2%

147,186

6.5%

Commercial mortgage - owner occupied

660,427

26.0%

577,541

25.6%

Commercial mortgage - nonowner occupied

531,954

20.9%

428,600

19.0%

Other

98,686

3.9%

79,630

3.5%

Total Commercial Loans

1,518,032

59.7%

1,281,436

56.7%

Commercial Construction Loans

147,215

5.8%

130,193

5.8%

Residential Mortgage Loans

Primary residence

472,482

18.6%

427,738

18.9%

Secondary residence

71,656

2.8%

65,063

2.9%

Investor property

133,083

5.2%

138,126

6.1%

Total Residential Mortgage Loans

677,221

26.6%

630,927

27.9%

Consumer Loans

Home equity

82,488

3.2%

73,223

3.2%

Consumer other

2,731

0.1%

3,488

0.2%

Total Consumer Loans

85,219

3.3%

76,711

3.4%

Residential Construction Loans

73,277

2.9%

90,918

4.0%

Total Gross Loans

$

2,544,713

100.0%

$

2,260,657

100.0%

UNITY BANCORP, INC.

QUARTERLY NON-GAAP RECONCILIATION

For the three months ended

(In thousands, except percentages and per share amounts)

December 31, 2025

September 30, 2025

December 31, 2024

Adjusted net income:

Net income (GAAP)

$

15,472

$

14,390

$

11,505

Non-recurring transactions:

Less: Release of credit losses, securities

-

(787)

-

Less: Net securities gains, unrealized

(1,475)

(218)

-

Add: Adjusted release (provision) for income taxes

354

238

-

Adjusted net income (non-GAAP)

$

14,351

$

13,623

$

11,505

Adjusted net income per common share:

Weighted average common shares outstanding - Basic

10,008

10,036

10,002

Weighted average common shares outstanding - Diluted

10,195

10,233

10,204

Net income per common share - Basic (GAAP)

$

1.55

$

1.43

$

1.15

Net income per common share - Diluted (GAAP)

1.52

1.41

1.13

Adjusted net income per common share - Basic (non-GAAP)

$

1.43

$

1.36

$

-

Adjusted net income per common share - Diluted (non-GAAP)

1.41

1.33

-

Adjusted return on average assets:

Total QTD average assets

2,792,216

2,702,470

2,501,821

Return on average assets (GAAP)

2.20

%

2.11

%

1.83

%

Adjusted return on average assets (non-GAAP)

2.04

2.00

-

Adjusted return on average equity:

Total QTD average equity

339,480

327,851

290,291

Return on average equity (GAAP)

18.08

%

17.41

%

15.77

%

Adjusted return on average equity (non-GAAP)

16.77

16.49

-

Unity Bancorp Inc. published this content on January 13, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on January 13, 2026 at 11:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]