Peoples Bancorp Inc. reported first-quarter 2026 net income of $29.0 million, down from $31.8 million in the fourth quarter of 2025 but up from $24.3 million a year earlier. Diluted earnings per share were $0.81, compared with $0.89 in the prior quarter and $0.68 in the first quarter of 2025.
Net interest income was $90.4 million, down $0.6 million from the linked quarter, but up $5.2 million, or 6%, from the same period last year. Net interest margin widened to 4.16% from 4.12% in the fourth quarter and rose 4 basis points from a year ago. Excluding accretion income, net interest margin improved 6 basis points from the prior quarter.
Provision for credit losses increased to $9.7 million from $8.1 million in the fourth quarter, though it was slightly below the $10.2 million recorded a year earlier. The company said the quarter’s provision reflected net charge-offs and weaker macroeconomic assumptions in its CECL model.
Non-interest income, excluding net gains and losses, rose $0.4 million, or 1%, from the prior quarter. Insurance income increased $1.1 million, driven by seasonal performance-based commissions, while electronic banking income and deposit account service charges each fell $0.4 million. Compared with the first quarter of 2025, non-interest income excluding gains and losses increased $1.2 million, helped by a $1.1 million rise in lease income and a $0.5 million increase in trust and investment income.
Non-interest expense climbed $0.3 million from the fourth quarter and $0.8 million from a year earlier. Salaries and employee benefits rose $0.7 million from the prior quarter, while operating lease expense increased $0.3 million and net occupancy and equipment expense rose $0.2 million. On a year-over-year basis, operating lease expense increased $0.8 million, net occupancy and equipment expense rose $0.6 million, and data processing and software expense increased $0.5 million.
The efficiency ratio was 58.6%, compared with 57.8% in the fourth quarter of 2025 and 60.7% in the first quarter of 2025.
Total deposits increased $38.2 million from year-end to March 31, 2026. Core deposits rose $191.8 million, offset in part by a strategic reduction in brokered CDs. Governmental deposits, non-interest-bearing deposits and savings balances all contributed to the increase.
Loan and lease balances ended the quarter at $13.3 million higher than at December 31, 2025, an annualized increase of 1%. Commercial and industrial loans grew $111.0 million, while construction loans fell $31.4 million, premium finance loans declined $24.2 million, other commercial real estate loans dropped $23.1 million and leases decreased $15.4 million. Versus March 31, 2025, total loans and leases were up $341.7 million, or 5%, led by a $303.0 million increase in commercial and industrial loans.
Asset quality improved. Net charge-offs fell to 0.40% of average total loans on an annualized basis from 0.44% in the prior quarter. Net charge-offs tied to the North Star Leasing division decreased $1.5 million. Total nonperforming assets declined $3.5 million, or 8%, from the fourth quarter and $6.2 million, or 13%, from a year ago. Nonperforming assets represented 0.59% of total loans and OREO, down from 0.64% at year-end and 0.71% a year earlier. Criticized loans fell $12.3 million from December 31.
Income tax expense was $8.3 million, up from $6.2 million in the prior quarter and $7.0 million a year earlier. The effective tax rate increased to 22.3% from 16.4% in the fourth quarter and was essentially unchanged from 22.4% in the first quarter of 2025.
On the balance sheet, available-for-sale investment securities rose $23.6 million from year-end but were down $65.7 million from a year ago. Held-to-maturity securities fell $39.2 million from December 31, 2025, but increased $130.2 million year over year. Peoples ended the quarter with $713.2 million of liquid and liquefiable assets and $945.3 million of borrowing capacity. As a result of these announcements, the company's shares have moved 0.59% on the market, and are now trading at a price of $32.31. For more information, read the company's full 8-K submission here.
