First National Corporation Reports $5.7 Million Net Income for Q2 2026

First National Corporation reported a net income of $5.7 million for the second quarter of 2026, reflecting an increase of $692,000 compared to $5.1 million in the same period of 2025. This translates to earnings of $0.63 per diluted share, up from $0.56 per diluted share a year earlier. The company's return on average assets improved to 1.11%, while return on average equity rose to 12.03%. The increase in net income was primarily driven by a $1.4 million rise in net interest income and a $129,000 increase in noninterest income, despite a $1.2 million rise in noninterest expenses.

For the six months ending June 30, 2026, First National Corporation's net income reached $10.6 million, a significant increase of $4 million from $6.6 million in the same period of 2025. Earnings per diluted share for this period were $1.17, compared to $0.74 a year prior. The growth in net income was attributed to a $2.7 million increase in net interest income and a $342,000 rise in noninterest income, alongside a $1.1 million decrease in noninterest expenses, largely due to reduced merger-related costs.

The company’s total assets increased to $2.076 billion as of June 30, 2026, marking a $37.7 million rise from December 31, 2025. This growth was supported by a $37.4 million increase in net loans, which totaled $1.487 billion, and a $2.8 million rise in interest-bearing deposits. Total liabilities also grew by $30.3 million, primarily due to changes in customer deposits, while total shareholders' equity increased by $7.4 million, driven by a rise in retained earnings.

In terms of operational metrics, First National Corporation's loan portfolio remains diversified, with real estate loans comprising 35% and commercial real estate loans making up 48% of the total. The company reported a provision for credit losses of $426,000 for the second quarter of 2026, a decrease from $911,000 in the same quarter of the previous year. The allowance for credit losses on loans was $14.9 million, or 1.00% of total loans, reflecting a slight decrease from 1.02% at the end of 2025.

Looking ahead, First National Corporation plans to optimize its branch network by selling two banking offices and consolidating three others, which is expected to streamline operations and improve profitability. The company anticipates a one-time gain from the sale of these offices in the fourth quarter of 2026. Overall, management remains optimistic about the company's growth trajectory, supported by its strategic initiatives and solid financial performance.