Unity Bancorp Q1 Net Income Down to $14.3M

By Chris Stiles • Tuesday, April 14 11:08 • Permanent Link

Unity Bancorp reported first-quarter net income of $14.3 million, or $1.40 a diluted share, down from $15.5 million, or $1.52 a share, in the fourth quarter of 2025.

Net interest income slipped to $30.7 million from $31.4 million, a decline of $0.7 million, while net interest margin narrowed 7 basis points to 4.53%. The company said the drop in net interest income was mainly due to day count.

The provision for credit losses fell to $1.0 million from $2.2 million in the prior quarter. Noninterest income declined to $2.9 million from $3.9 million, a $1.0 million drop, after the previous quarter included a $1.5 million unrealized gain tied to Patriot.

Noninterest expense rose to $14.1 million from $13.3 million, driven by higher compensation and benefits costs. In the fourth quarter, compensation and benefits included $0.7 million of one-time accrual reversals.

The effective tax rate increased to 22.7% from 21.4%.

On the balance sheet, gross loans grew $56.9 million, or 2.2%, from Dec. 31, 2025, to March 31, 2026, and were up $256.5 million, or 10.9%, from a year earlier. Total deposits increased $55.1 million, or 2.4%, from the prior quarter.

Nonaccrual assets edged up to $32.1 million from $31.3 million at year-end. The nonaccrual loans-to-total loans ratio was 1.18%, and nonaccrual assets were 1.06% of total assets. The allowance for credit losses stood at 1.28% of gross loans.

Borrowed funds fell $7.5 million from the previous quarter. Shareholders’ equity increased to $358.1 million from $345.6 million, while book value per common share rose to $35.66 from $34.63.

Capital ratios also improved modestly: the leverage ratio rose to 12.93% from 12.72%, common equity tier 1 to 14.50% from 14.45%, Tier 1 capital to 14.91% from 14.87%, and total capital to 16.16% from 16.12%.

The company ended the quarter with $229.2 million of cash and cash equivalents and about $410.7 million of additional funding capacity. Following these announcements, the company's shares moved 0.18%, and are now trading at a price of $51.11. For more information, read the company's full 8-K submission here.

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