Timberland Bancorp Reports 8.7% Increase in Net Income for Third Quarter

Timberland Bancorp, Inc. reported a solid financial performance for the third quarter and nine months ending June 30, 2026, with net income rising to $7.72 million, an increase of 8.7% from $7.10 million in the same period last year. For the nine-month period, net income reached $23.07 million, up 11.4% from $20.72 million. The increase in profitability was primarily driven by a $4.19 million rise in net interest income, which totaled $56 million for the nine months, reflecting growth in average loan balances and improved funding costs. The company’s diluted earnings per share also saw an increase, reaching $0.98 for the quarter and $2.92 for the nine months, compared to $0.90 and $2.60, respectively, in the prior year.

Total assets for Timberland Bancorp increased by $48.05 million, or 2.4%, to $2.06 billion as of June 30, 2026, compared to $2.01 billion at the end of the previous fiscal year. This growth was primarily attributed to a $32.06 million increase in net loans receivable, which rose to $1.50 billion, driven by higher balances in multi-family construction and commercial real estate loans. Total deposits also increased by $46.91 million, or 2.7%, to $1.76 billion, supported by growth in money market and NOW checking accounts, although non-interest-bearing demand deposits saw a decline.

In terms of operational metrics, Timberland Bancorp's loan originations surged by 31.8% to $277.85 million for the nine months ended June 30, 2026, compared to $210.81 million in the same period last year. The company also reported a significant increase in sales of fixed-rate one- to four-family loans, which rose by 68% to $22.85 million, reflecting a strategic focus on asset-liability management. However, the company experienced a rise in non-accrual loans, which increased by 94.1% to $8.56 million, primarily due to a significant addition in the commercial real estate portfolio.

Looking ahead, Timberland Bancorp remains optimistic about its growth trajectory, supported by a strong capital position and liquidity. The company’s total shareholders’ equity increased by 4.0% to $273.21 million, bolstered by retained earnings and stock repurchases. The bank's capital ratios indicate a "well-capitalized" status under regulatory requirements, providing a solid foundation for future growth. Management continues to monitor economic conditions and market trends, which may influence credit quality and operational performance, but anticipates maintaining its dividend policy and exploring further growth opportunities in the coming quarters.