CoastalSouth Bancshares Reports $7.3 Million Net Income in Q2 2026, 22.9% Increase

CoastalSouth Bancshares, Inc. reported a net income of $7.3 million for the second quarter of 2026, reflecting a 22.9% increase from $6.0 million in the same period last year. This growth was primarily driven by a rise in net interest income, which reached $20.7 million, up from $18.1 million in the prior year, attributed to an increase in average loans and a decrease in the average cost of interest-bearing liabilities. The company's total interest income also rose to $33.6 million, compared to $31.8 million in the previous year, while interest expense decreased to $12.9 million from $13.7 million.

In terms of overall financial performance, CoastalSouth's total assets increased by 5.0% to $2.42 billion as of June 30, 2026, compared to $2.31 billion at the end of 2025. The growth in assets was largely due to a $140.2 million increase in gross loans, which totaled $1.93 billion, representing a 7.8% rise. Loans held for investment (LHFI) increased to $1.71 billion, while loans held for sale (LHFS) also saw growth, reaching $223.1 million, up from $170.9 million at the end of 2025.

The company’s strategic developments included a focus on expanding its loan portfolio, particularly in commercial real estate and owner-occupied loans, which saw significant increases. The allowance for credit losses (ACL) on loans rose to $19.8 million, or 1.16% of LHFI, reflecting a proactive approach to managing credit risk amid growing loan volumes. The company also maintained a strong capital position, with a total capital ratio of 13.39% and a Tier 1 capital ratio of 12.30%, both exceeding regulatory requirements for a well-capitalized institution.

Operationally, CoastalSouth Bancshares reported an increase in its employee headcount to 201, up from 188 a year earlier, indicating a commitment to supporting its growth strategy. The company also experienced a rise in noninterest income, which totaled $2.2 million for the second quarter, a 22.7% increase from the previous year, driven by gains in various categories including bank-owned life insurance and mortgage originations. The outlook for the company remains positive, with management expressing confidence in its ability to navigate market conditions and continue its growth trajectory.