NSTS Bancorp Reports $204,000 Net Loss in Q2 2026, Sees Asset Growth

NSTS Bancorp, Inc. reported a net loss of $204,000 for the second quarter of 2026, a slight improvement from a net loss of $258,000 in the same period last year. For the first half of 2026, the company recorded a net loss of $243,000, compared to a loss of $586,000 in the first half of 2025. The decrease in net loss is attributed to an increase in noninterest income, particularly from a $918,000 death benefit received from bank-owned life insurance (BOLI), which offset rising noninterest expenses related to the vesting of stock options and restricted stock awards following the passing of the company's President and CEO, Nathan Walker.

Total assets increased to $269.9 million as of June 30, 2026, up from $266.6 million at the end of 2025. This growth was primarily driven by a $13.5 million increase in cash and cash equivalents, reflecting a rise in total deposits, which reached $184.1 million, up from $181.5 million at year-end 2025. However, loans held for sale decreased significantly to $1.4 million from $4.5 million, influenced by the divestiture of the mortgage lending division, Oak Leaf Community Mortgage, which occurred on June 1, 2026.

In terms of operational metrics, the company’s net interest income for the second quarter was $1.7 million, down from $1.8 million a year earlier, with a slight increase in the interest rate spread to 2.21%. The average yield on loans decreased to 5.13%, down from 5.32% in the prior year, while the average interest-earning assets decreased to $251.3 million from $260.7 million. The company’s allowance for credit losses on loans stood at $1.1 million, with minimal change from the previous period, indicating a stable credit quality despite an increase in nonaccrual loans to $2.4 million.

Strategically, NSTS Bancorp is in the process of merging with Brookfield Bancshares, Inc., a transaction expected to close in the fourth quarter of 2026, pending regulatory approvals. Under the merger agreement, shareholders will receive cash consideration totaling approximately $73.7 million. The merger is anticipated to enhance the company’s operational capabilities and market presence. Additionally, the company is actively managing its liquidity, with a Tier 1 capital ratio of 25.48%, significantly above the regulatory minimum, indicating a strong capital position as it navigates these changes.