Affinity Bancshares Reports $2.3 Million Net Income in Q1 2026, Announces Merger with Fidelity BancShares

Affinity Bancshares, Inc. reported a net income of $2.3 million for the first quarter of 2026, reflecting a 24.7% increase from $1.8 million in the same period of the previous year. This growth was primarily driven by a rise in net interest income, which increased by 3.1% to $7.6 million, compared to $7.3 million in the first quarter of 2025. The company’s total interest income rose to $12.3 million, up from $12.1 million, largely due to a $490,000 increase in interest income from loans, which reached $11.1 million. The average yield on loans slightly decreased to 6.04% from 6.05%, while the average balance of loans increased by 4.7% to $747.2 million.

In terms of financial position, total assets increased by $43 million, or 4.9%, to $924.7 million as of March 31, 2026, compared to $881.7 million at the end of 2025. This growth was attributed to a $9.1 million increase in gross loans, which totaled $751.8 million, and a rise in cash and cash equivalents. Total deposits also saw a significant increase of $39.3 million, or 5.7%, reaching $734.3 million, driven by higher demand deposits and money market accounts. The loan-to-deposit ratio improved to 102.4% from 106.9% in the previous quarter.

Operationally, Affinity Bancshares has been focusing on expanding its loan portfolio, particularly in commercial and industrial loans, which increased by 7.9% to $158 million. The company also reported a decrease in the allowance for credit losses, which stood at $8.9 million, down from $9.0 million at the end of 2025. The provision for credit losses was not recorded for the first quarter of 2026, compared to a $50,000 provision in the same period last year. This reflects a positive trend in credit quality and risk management.

Strategically, Affinity Bancshares announced a merger agreement with Fidelity BancShares, which is expected to close in the third quarter of 2026, subject to regulatory and shareholder approvals. Under the terms of the agreement, each share of Affinity common stock will be converted into $23.00 in cash, subject to adjustments based on the company’s stockholders' equity at closing. This merger is anticipated to enhance the company’s market position and operational capabilities.

Looking ahead, Affinity Bancshares remains optimistic about its growth trajectory, supported by a solid capital position and a commitment to maintaining strong liquidity. The company exceeded all regulatory capital requirements, with a common equity tier 1 capital ratio of 12.30% as of March 31, 2026. Management is focused on leveraging its operational strengths and strategic initiatives to navigate the evolving market landscape and enhance shareholder value.