Orange County Bancorp Reports $11.3 Million Net Income, 29.6% Increase in Q1 2026

Orange County Bancorp, Inc. reported a net income of $11.3 million for the first quarter of 2026, reflecting a 29.6% increase from $8.7 million in the same period last year. This growth was primarily driven by an 18.1% rise in net interest income, which reached $27.9 million, up from $23.6 million in the prior year. The increase in net interest income was attributed to a higher average balance of interest-earning assets, which grew by $142.6 million, alongside a slight increase in the yield on these assets. Interest income from loans specifically rose by 9.1% to $29.8 million, supported by a 6.9% increase in the average balance of loans.

Total assets for the company increased by $46.2 million, or 1.7%, to $2.7 billion as of March 31, 2026, compared to $2.66 billion at the end of 2025. This growth was primarily fueled by a significant increase in cash and due from banks, which rose by 26.1% to $257.5 million. Loans, net of allowances for credit losses, remained relatively stable, increasing slightly to $1.92 billion from $1.92 billion at the end of the previous year. The allowance for credit losses was reported at $27.8 million, representing 1.43% of total loans, a slight increase from 1.42% at the end of 2025.

In terms of operational developments, the bank's total deposits rose by $39.4 million, or 1.7%, to $2.35 billion, driven by a focus on commercial transaction accounts. Non-interest-bearing demand deposits increased slightly, while interest-bearing demand deposits saw a notable rise of 12.7%. However, money market accounts experienced a significant decline, reflecting a strategic shift towards more stable core deposits. The bank's total non-performing loans increased to $26.1 million, primarily due to issues within the commercial real estate sector, which accounted for $23 million of the total.

Looking ahead, Orange County Bancorp remains focused on maintaining its liquidity and capital position, with a well-capitalized status under regulatory guidelines. The company has a robust capacity for additional borrowings, with $660.7 million available from the Federal Home Loan Bank of New York. Management anticipates continued growth in deposits and loans, while also monitoring credit quality closely amid changing economic conditions. The bank's strategic initiatives include enhancing its product offerings and expanding its market presence, particularly in the Lower Hudson Valley region and surrounding areas.