Bank of the James Financial Group Reports Asset Growth and Increased Net Income for Q2 2026

Bank of the James Financial Group, Inc. reported a modest increase in total assets, reaching $1.041 billion as of June 30, 2026, compared to $1.039 billion at the end of 2025. This 0.2% growth was primarily driven by an increase in the loan portfolio and available-for-sale securities, despite a significant reduction in cash and cash equivalents, particularly in federal funds sold, which decreased by 80.6%. The company’s total loans, excluding those held for sale, rose to $692.7 million, marking a 3.7% increase from $667.8 million at the end of the previous year, largely due to growth in commercial and commercial real estate lending.

The bank's net income for the second quarter of 2026 was $3.24 million, a 19.8% increase from $2.70 million in the same period of 2025. For the first half of 2026, net income reached $6.01 million, up 69.6% from $3.55 million year-over-year. This growth was attributed to an increase in net interest income, which rose to $9.25 million for the quarter and $17.99 million for the six months, driven by a larger loan portfolio and higher yields on earning assets. The bank's net interest margin improved to 3.71% for the second quarter, compared to 3.45% in the prior year.

In terms of operational metrics, the bank's total deposits slightly decreased to $935.2 million from $937.1 million, reflecting a decline in interest-bearing deposits, which was partially offset by an increase in noninterest-bearing demand deposits. The bank's allowance for credit losses stood at $6.60 million, representing 0.95% of total loans, a slight increase from the previous period. Nonperforming loans decreased to $1.09 million, or 0.16% of total loans, down from $1.70 million at the end of 2025.

Strategically, the bank is undergoing changes in its branch operations, with plans to close two full-service branches while transitioning one to a loan production office. This decision is not expected to materially impact the bank's financial position. Additionally, the bank's investment advisory subsidiary, Pettyjohn, Wood & White, reported assets under management of approximately $1.09 billion, reflecting a 17.4% increase from the previous year, driven by net inflows and favorable market conditions.

Looking ahead, Bank of the James Financial Group anticipates continued growth in its loan portfolio and noninterest income, although it remains cautious about potential impacts from rising interest rates and competitive pressures on deposit costs. The bank's management believes that its current liquidity position is adequate and plans to leverage its market presence to enhance profitability further.