Carter Bankshares Reports Significant Net Income Growth in Q2 2026

Carter Bankshares, Inc. reported significant financial performance improvements in its latest 10-Q filing for the quarter ending June 30, 2026. The company achieved a net income of $28.9 million, or $1.31 per diluted share, compared to $8.5 million, or $0.37 per diluted share, for the same period in 2025. For the first half of 2026, net income reached $114.7 million, translating to $5.18 per diluted share, up from $17.5 million, or $0.76 per diluted share, in the prior year. The increase in net income was primarily driven by a substantial rise in net interest income, which totaled $40.0 million for the second quarter, a 23.5% increase from the previous year, and $75.9 million for the first half, a 21.4% increase.

The company’s total assets decreased slightly to $4.8 billion as of June 30, 2026, down from $4.9 billion at the end of 2025. This decline was largely attributed to a reduction in portfolio loans, which fell to $3.7 billion, primarily due to the completion of a significant loan sale transaction in March 2026. The loan sale resulted in a net gain of $80 million and a release of $18 million in specific reserves, significantly improving the company's asset quality and liquidity position. Nonperforming loans decreased dramatically to $37.6 million, or 1.01% of total portfolio loans, compared to $244 million, or 6.29%, at the end of 2025.

Carter Bankshares also made strategic moves to enhance its operational efficiency and market presence. The company completed the sale of its membership interest in Bearing Insurance Group, resulting in a pre-tax gain of $35.9 million. Additionally, the company opened a loan production office in Greenville, South Carolina, marking its first physical presence in the state and supporting its growth strategy in the Carolinas. The company’s total deposits decreased slightly to $4.2 billion, with notable increases in noninterest-bearing and interest-bearing demand deposits, offsetting declines in certificates of deposit and money market accounts.

The filing also highlighted the company’s focus on maintaining a strong capital position, with shareholders' equity increasing to $539.1 million, a 28.5% rise from the previous year. The company’s capital ratios remained well above regulatory requirements, with a leverage ratio of 11.65% and a common equity tier 1 ratio of 14.26%. Looking ahead, Carter Bankshares aims to continue its growth trajectory through organic loan growth and potential acquisitions, while closely monitoring its credit risk and maintaining a diversified deposit base. The company’s strategic initiatives, including the recent loan sale and insurance transaction, are expected to enhance future earnings potential and improve its overall risk profile.