Narragansett Financial Corporation Reports Asset Growth and Increased Net Income for Q2 2026

Narragansett Financial Corporation reported a modest increase in total assets, rising to $2.87 billion as of June 30, 2026, up from $2.86 billion at the end of 2025. This growth was primarily driven by a $14.2 million increase in cash and cash equivalents, which reached $52.7 million, and a $17.5 million rise in securities available for sale, totaling $359.8 million. However, the company experienced a decrease in gross loans, which fell by $15.4 million, or 0.7%, to $2.25 billion, largely due to significant residential mortgage loan sales totaling $81 million during the first half of 2026.

In terms of profitability, Narragansett Financial reported a net income of $3.5 million for the second quarter of 2026, a 54% increase from $2.3 million in the same period of 2025. For the first half of 2026, net income reached $4.7 million, up 121% from $2.1 million in the prior year. This improvement was attributed to a decrease in interest expenses, which fell by 20.6% to $13.8 million, and a reduction in the provision for credit losses, which dropped to $800,000 from $2 million a year earlier. The net interest income for the second quarter increased by 14.3% to $21.4 million, reflecting a favorable shift in the interest rate spread and net interest margin.

Operationally, the company saw a notable increase in customer service fees, which rose by 6.6% to $2.8 million, and trust department fees, which increased by 9.8% to $1.6 million. However, total other income decreased by 4.9% to $13.9 million, primarily due to a decline in mortgage banking income and insurance commissions. The total number of full-time equivalent employees remained stable at 566, while the company maintained its 25 office locations.

Looking ahead, Narragansett Financial is in the process of reorganizing into a two-tier holding company structure, with Narragansett Bancorp, Inc. set to become the mid-tier holding company. This reorganization is subject to regulatory approval and aims to enhance the company's capital structure and operational flexibility. Management remains optimistic about future growth, citing a strong liquidity position and the potential for increased net interest income from the proceeds of the upcoming stock offering. The company is also focused on managing interest rate risk and maintaining compliance with regulatory capital requirements, as it continues to navigate a competitive banking environment.