Community Trust Bancorp Q3 2026 profit dips on higher credit loss provisions

Community Trust Bancorp, Inc. (NASDAQ: CTBI) reported third-quarter 2026 net income of $25.9 million, or $1.43 per basic share, a decline from $29.6 million in the prior quarter and a rise from $23.9 million in the same period last year. The decrease in earnings was driven by a $6.4 million increase in the provision for credit losses, which reached $9.2 million for the quarter.

Total revenue for the quarter increased by $1.2 million compared to the second quarter of 2026 and by $8.2 million compared to the third quarter of 2025. Net interest income stood at $61.1 million, up 0.3% from the previous quarter and 9.9% year-over-year. This growth occurred despite a 17-basis-point decrease in the net interest margin from the prior quarter, as the bank's cost of funds rose by 14 basis points while the yield on average earning assets fell by 5 basis points.

The bank's loan portfolio expanded to $5.3 billion, an increase of $177.9 million or 13.8% on an annualized basis for the quarter. Deposits, including repurchase agreements, grew to $6.0 billion, up $86.1 million or 5.7% on an annualized basis. The ratio of average loans to deposits stood at 86.2% for the quarter, compared to 87.2% in the prior quarter.

Credit quality metrics showed mixed results. Net loan charge-offs totaled $6.6 million, an annualized rate of 0.50% of average loans, a significant jump from $0.9 million in the prior quarter and $2.7 million in the third quarter of 2025. However, total nonperforming loans decreased to $22.5 million at September 30, 2026, down $7.3 million from the prior quarter. Nonperforming assets fell to $27.7 million, a reduction of $5.6 million quarter-over-quarter.

Noninterest income reached $18.6 million, rising 6.0% from the previous quarter and 16.9% year-over-year, primarily due to a $0.9 million increase in deposit-related fees and growth in trust and wealth management income. Noninterest expense declined by $0.9 million to $36.5 million, improving the efficiency ratio to 45.90% from 47.99% in the second quarter.

For the nine months ended September 30, 2026, Community Trust Bancorp earned $82.7 million, or $4.58 per basic share, compared to $70.8 million for the same period in 2025.