Community Trust Bancorp, Inc. (NASDAQ:CTBI):
Earnings Summary
| (in thousands except per share data) | 1Q2026 | 4Q2025 | 1Q2025 |
| Net income | $27,192 | $27,276 | $21,972 |
| Earnings per share | $1.51 | $1.51 | $1.22 |
| Earnings per share – diluted | $1.50 | $1.51 | $1.22 |
| Return on average assets | 1.65% | 1.63% | 1.44% |
| Return on average equity | 12.62% | 12.71% | 11.50% |
| Efficiency ratio | 48.72% | 48.70% | 51.86% |
| Tangible common equity | 12.07% | 11.94% | 11.57% |
| Dividends declared per share | $0.53 | $0.53 | $0.47 |
| Book value per share | $47.99 | $47.26 | $43.32 |
| Weighted average shares | 18,049 | 18,025 | 17,995 |
| Weighted average shares – diluted | 18,080 | 18,064 | 18,022 |
Community Trust Bancorp, Inc. (NASDAQ:CTBI) achieved earnings for the first quarter 2026 of $27.2 million, or $1.51 per basic earnings per share, compared to $27.3 million, or $1.51 per basic share, earned during the fourth quarter 2025 and $22.0 million, or $1.22 per basic share, earned during the first quarter 2025. Total revenue for the quarter was $0.5 million below prior quarter but $8.0 million above prior year same quarter. Net interest income for the quarter increased $0.7 million compared to prior quarter and $7.5 million compared to prior year same quarter, and noninterest income decreased $1.2 million compared to prior quarter but increased $0.5 million compared to prior year same quarter. Our provision for credit losses for the quarter decreased $0.6 million from prior quarter and $1.3 million from prior year same quarter. Noninterest expense increased $0.1 million compared to prior quarter and $2.3 million compared to prior year same quarter.
1st Quarter 2026 Highlights
- Net interest income for the quarter of $58.8 million was $0.7 million, or 1.1%, above prior quarter and $7.5 million, or 14.7%, above prior year same quarter, as our net interest margin increased 12 basis points from prior quarter and 22 basis points from prior year same quarter.
- Provision for credit losses at $2.3 million for the quarter decreased $0.6 million from prior quarter and $1.3 million from prior year same quarter.
- Noninterest income for the quarter of $15.4 million was $1.2 million, or 7.2%, below prior quarter but $0.5 million, or 3.5%, above prior year same quarter.
- Noninterest expense for the quarter of $36.5 million was $0.1 million, or 0.2%, above prior quarter and $2.3 million, or 6.8%, above prior year same quarter.
- Our loan portfolio at $5.0 billion increased $95.9 million, an annualized 7.9%, for the quarter and $354.3 million, or 7.6%, from March 31, 2025.
- We had net loan charge-offs of $1.3 million, an annualized 0.11% of average loans, for the quarter compared to $1.8 million, an annualized 0.14% of average loans, for prior quarter and $1.6 million, an annualized 0.14% of average loans, for the first quarter 2025.
- Our total nonperforming loans at $20.7 million at March 31, 2026 increased $1.6 million for the quarter but decreased $5.8 million from March 31, 2025. Nonperforming assets at $24.1 million increased $1.9 million for the quarter but decreased $7.2 million from March 31, 2025.
- Deposits, including repurchase agreements, at $5.7 billion increased $35.1 million, an annualized 2.5%, for the quarter and $375.1 million, or 7.0%, from March 31, 2025.
- Shareholders’ equity at $871.2 million increased $15.2 million, an annualized 7.2%, for the quarter and $87.1 million, or 11.1%, from March 31, 2025.
Net Interest Income
| Percent Change | |||||
| 1Q 2026 Compared to: | |||||
| ($ in thousands) | 1Q2026 | 4Q2025 | 1Q2025 | 4Q2025 | 1Q2025 |
| Components of net interest income | |||||
| Income on earning assets | $87,755 | $89,532 | $82,054 | (2.0)% | 6.9% |
| Expense on interest bearing liabilities | 28,973 | 31,415 | 30,787 | (7.8)% | (5.9)% |
| Net interest income | 58,782 | 58,117 | 51,267 | 1.1% | 14.7% |
| TEQ | 317 | 323 | 273 | (1.9)% | 16.3% |
| Net interest income, tax equivalent (non-GAAP) | $59,099 | $58,440 | $51,540 | 1.1% | 14.7% |
| Average yield and rates paid: | |||||
| Earning assets yield | 5.65% | 5.64% | 5.71% | 0.0% | (1.1)% |
| Rate paid on interest bearing liabilities | 2.61% | 2.78% | 3.02% | (5.9)% | (13.3)% |
| Gross interest margin | 3.04% | 2.86% | 2.69% | 5.8% | 12.5% |
| Net interest margin | 3.79% | 3.67% | 3.57% | 3.3% | 6.0% |
| Average balances: | |||||
| Investment securities | $1,113,988 | $1,076,245 | $1,045,953 | 3.5% | 6.5% |
| Loans | 4,934,257 | 4,821,223 | 4,533,091 | 2.3% | 8.8% |
| Earning assets | 6,327,329 | 6,321,901 | 5,848,092 | 0.1% | 8.2% |
| Interest-bearing liabilities | 4,494,829 | 4,485,186 | 4,138,451 | 0.2% | 8.6% |
Net interest income for the quarter of $58.8 million was $0.7 million, or 1.1%, above prior quarter and $7.5 million, or 14.7%, above prior year same quarter, as our net interest margin, on a fully tax equivalent basis, increased 12 basis points from prior quarter and 22 basis points from prior year same quarter. Our quarterly average earning assets increased $5.4 million, an annualized 0.3%, from prior quarter and $479.2 million, or 8.2%, from prior year same quarter. Our yield on average earning assets increased 1 basis point from prior quarter but decreased 6 basis points from prior year same quarter, while our cost of funds decreased 17 basis points from prior quarter and 41 basis points from prior year same quarter.
Our ratio of average loans to deposits, including repurchase agreements, was 87.2% for the quarter compared to 84.9% for prior quarter and 85.9% for same quarter prior year.
Noninterest Income
| Percent Change | |||||
| 1Q 2026 Compared to: | |||||
| ($ in thousands) | 1Q2026 | 4Q2025 | 1Q2025 | 4Q2025 | 1Q2025 |
| Deposit related fees | $7,155 | $7,537 | $6,822 | (5.1)% | 4.9% |
| Trust and wealth management income | 4,462 | 4,422 | 3,981 | 0.9% | 12.1% |
| Gains on sales of loans | 51 | 107 | 47 | (52.4)% | 8.4% |
| Loan related fees | 1,039 | 932 | 965 | 11.5% | 7.7% |
| Bank owned life insurance revenue | 1,714 | 1,179 | 1,035 | 45.4% | 65.6% |
| Brokerage revenue | 520 | 522 | 494 | (0.5)% | 5.2% |
| Other | 473 | 1,904 | 1,553 | (75.2)% | (69.6)% |
| Total noninterest income | $15,414 | $16,603 | $14,897 | (7.2)% | 3.5% |
Noninterest income for the quarter of $15.4 million was $1.2 million, or 7.2%, below prior quarter but $0.5 million, or 3.5%, above prior year same quarter. The variance quarter over quarter was primarily the result of decreases in net securities gains ($0.7 million), net gains on the sale of fixed assets ($0.5 million), deposit related fees ($0.4 million), partially offset by an increase in bank owned life insurance revenue ($0.5 million). The decrease in net gains on the sale of fixed assets is the result of a $0.5 million gain taken in the fourth quarter 2025 from the sale of one of our branch locations. Year over year increases for the quarter in bank owned life insurance revenue ($0.7 million), trust and wealth management income ($0.5 million), and deposit related fees ($0.3 million) were partially offset by a $1.0 million decrease in securities gains. The variances in securities gains resulted primarily from changes in the valuation of our equity securities.
Noninterest Expense
| Percent Change | |||||
| 1Q 2026 Compared to: | |||||
| ($ in thousands) | 1Q2026 | 4Q2025 | 1Q2025 | 4Q2025 | 1Q2025 |
| Salaries | $13,629 | $13,981 | $13,269 | (2.5)% | 2.7% |
| Employee benefits | 8,476 | 7,952 | 6,849 | 6.6% | 23.8% |
| Net occupancy and equipment | 3,699 | 3,373 | 3,440 | 9.7% | 7.5% |
| Data processing | 2,955 | 2,877 | 2,859 | 2.7% | 3.4% |
| Legal and professional fees | 1,164 | 1,019 | 1,225 | 14.2% | (5.0)% |
| Advertising and marketing | 700 | 776 | 673 | (9.8)% | 4.0% |
| Taxes other than property and payroll | 617 | 687 | 529 | (10.2)% | 16.6% |
| Other | 5,297 | 5,787 | 5,364 | (8.5)% | (1.2)% |
| Total noninterest expense | $36,537 | $36,452 | $34,208 | 0.2% | 6.8% |
Noninterest expense for the quarter of $36.5 million was $0.1 million, or 0.2%, above prior quarter and $2.3 million, or 6.8%, above prior year same quarter. Quarter over quarter increases in occupancy and equipment expense ($0.3 million) and repossession expense ($0.4 million) were partially offset by decreases in contribution expense ($0.4 million) and operating losses ($0.2 million). The decrease in contribution expense resulted from the $0.4 million expense associated with the donation of one of our branch locations in the fourth quarter 2025. The year over year increase for the quarter primarily resulted from an increase in salaries ($0.4 million) and other employee benefits, including bonuses ($0.5 million), and the cost of group medical and life insurance expense ($1.3 million).
Provision for Credit Losses
Our provision for credit losses at $2.3 million for the quarter decreased $0.6 million from prior quarter and $1.3 million from prior year same quarter. Of the provision for the quarter, $2.5 million was attributable to the allowance for credit losses, with an expense recovery of $0.2 million recognized in the provision for unfunded commitments.
Balance Sheet Review
Total Loans
| Percent Change | |||||
| 1Q 2026 Compared to: | |||||
| ($ in thousands) | 1Q2026 | 4Q2025 | 1Q2025 | 4Q2025 | 1Q2025 |
| Commercial nonresidential real estate | $994,914 | $959,915 | $913,238 | 3.6% | 8.9% |
| Commercial residential real estate | 596,948 | 580,652 | 535,427 | 2.8% | 11.5% |
| Hotel/motel | 507,243 | 497,764 | 475,582 | 1.9% | 6.7% |
| Other commercial | 440,980 | 454,944 | 433,379 | (3.1)% | 1.8% |
| Total commercial | 2,540,085 | 2,493,275 | 2,357,626 | 1.9% | 7.7% |
| Residential mortgage | 1,245,759 | 1,206,820 | 1,066,973 | 3.2% | 16.8% |
| Home equity loans/lines | 191,178 | 186,798 | 172,688 | 2.3% | 10.7% |
| Total residential | 1,436,937 | 1,393,618 | 1,239,661 | 3.1% | 15.9% |
| Consumer indirect | 873,980 | 862,458 | 888,635 | 1.3% | (1.6)% |
| Consumer direct | 139,819 | 145,591 | 150,614 | (4.0)% | (7.2)% |
| Total consumer | 1,013,799 | 1,008,049 | 1,039,249 | 0.6% | (2.4)% |
| Total loans | $4,990,821 | $4,894,942 | $4,636,536 | 2.0% | 7.6% |
Total Deposits and Repurchase Agreements
| Percent Change | |||||
| 1Q 2026 Compared to: | |||||
| ($ in thousands) | 1Q2026 | 4Q2025 | 1Q2025 | 4Q2025 | 1Q2025 |
| Noninterest bearing deposits | $1,262,835 | $1,263,243 | $1,235,544 | 0.0% | 2.2% |
| Interest bearing deposits | |||||
| Interest checking | 190,769 | 195,458 | 158,968 | (2.4)% | 20.0% |
| Money market savings | 1,917,509 | 1,877,815 | 1,828,051 | 2.1% | 4.9% |
| Savings accounts | 508,553 | 499,276 | 516,379 | 1.9% | (1.5)% |
| Time deposits | 1,554,554 | 1,553,266 | 1,372,363 | 0.1% | 13.3% |
| Repurchase agreements | 298,721 | 308,799 | 246,556 | (3.3)% | 21.2% |
| Total interest bearing deposits and repurchase agreements | 4,470,106 | 4,434,614 | 4,122,317 | 0.8% | 8.4% |
| Total deposits and repurchase agreements | $5,732,941 | $5,697,857 | $5,357,861 | 0.6% | 7.0% |
CTBI’s total assets at $6.7 billion increased $57.0 million, or 3.5% annualized, for the quarter and $464.6 million, or 7.4%, from March 31, 2025. Loans outstanding at $5.0 billion increased $95.9 million, an annualized 7.9%, for the quarter and $354.3 million, or 7.6%, from March 31, 2025. The increase in loans for the quarter included a $46.8 million increase in the commercial loan portfolio, a $43.3 million increase in the residential loan portfolio, and an $11.5 million increase in the consumer indirect loan portfolio, partially offset by a $5.7 million decrease in the consumer direct loan portfolio. CTBI’s investment portfolio at $1.1 billion decreased $33.0 million, an annualized 11.9%, for the quarter as management allocated investment maturities into the loan portfolio but increased $79.1 million, or 7.8%, from March 31, 2025. Deposits in other banks decreased $33.8 million for the quarter and $5.1 million from March 31, 2025. Deposits, including repurchase agreements, at $5.7 billion increased $35.1 million, an annualized 2.5%, for the quarter and $375.1 million, or 7.0%, from March 31, 2025. CTBI is not dependent on any one customer or group of customers for their source of deposits. As of March 31, 2026, two customers accounted for over 3% each (3.7% and 3.2%) of our $5.4 billion in deposits. Only these two customer relationships accounted for more than 1% each of our deposits.
Shareholders’ equity at $871.2 million increased $15.2 million, an annualized 7.2%, for the quarter and $87.1 million, or 11.1%, from March 31, 2025. Net unrealized losses on securities, net of deferred taxes, were $68.0 million at March 31, 2026, compared to $64.8 million at December 31, 2025 and $86.1 million at March 31, 2025. CTBI’s annualized dividend yield to shareholders as of March 31, 2026 was 3.49%.
Asset Quality
Our total nonperforming loans at $20.7 million at March 31, 2026 increased $1.6 million for the quarter but decreased $5.8 million from March 31, 2025. Nonaccrual loans at $11.1 million increased $2.6 million from prior quarter but decreased $4.6 million from March 31, 2025. Accruing loans 90+ days past due at $9.6 million decreased $1.0 million from prior quarter and $1.2 million from March 31, 2025. Accruing loans 30-89 days past due at $24.8 million increased $4.6 million from prior quarter and $10.3 million from March 31, 2025. Our loan portfolio management processes focus on the immediate identification, management, and resolution of problem loans to maximize recovery and minimize loss.
We had net loan charge-offs of $1.3 million, an annualized 0.11% of average loans, for the quarter compared to $1.8 million, an annualized 0.14% of average loans, for prior quarter and $1.6 million, an annualized 0.14% of average loans, for the first quarter 2025. Of the net charge-offs for the quarter, $0.5 million were in commercial loans, $0.2 million were in residential loans, $0.5 million were in consumer indirect loans, and $0.1 million were in consumer direct loans.
Allowance for Credit Losses
Our reserve coverage (allowance for credit losses to nonperforming loans) at March 31, 2026 was 295.8% compared to 314.0% at December 31, 2025 and 214.7% at March 31, 2025. Our loan loss reserve as a percentage of total loans outstanding at March 31, 2026 remained at 1.23% from December 31, 2025 and March 31, 2025. The table below shows the changes in components of the allowance for credit losses during the first quarter 2026:
| Beginning balance | $60,169 |
| New loan volume | 4,608 |
| Changes in existing loan balances | (658) |
| Loan exiting | (2,767) |
| Historical loss rate | (124) |
| Qualitative factors | 188 |
| Other changes | (95) |
| Ending balance | $61,321 |
