Third quarter 2026 highlights:
• Net income of $61.0 million, or $1.50 per share • Core net income1 of $64.2 million, or $1.58 per share • Return on average common equity of 21.3% and core return on average tangible common equity1 of 25.0% • Net interest margin of 2.76%, cost of deposits of 1.27% • Quarterly cash dividend of $0.50 per share for the quarter ended September 30, 2026 • Advancing CIBC Caribbean acquisition; closing expected in H1 2027 Hamilton, Bermuda - October 27, 2026: The Bank of N.T. Butterfield & Son Limited ("Butterfield" or the "Bank") (BSX: NTB.BH; NYSE: NTB) today announced financial results for the quarter ended September 30, 2026.
Net income for the third quarter of 2026 was $61.0 million, or $1.50 per diluted common share, compared to net income of $46.9 million, or $1.16 per diluted common share, for the previous quarter and $61.1 million, or $1.46 per diluted common share, for the third quarter of 2025.
Core net income1 for the third quarter of 2026 was $64.2 million, or $1.58 per diluted common share, compared to $63.9 million, or $1.58 per diluted common share, for the previous quarter and $63.3 million, or $1.51 per diluted common share, for the third quarter of 2025. The return on average common equity for the third quarter of 2026 was 21.3% compared to 16.6% for the previous quarter and 22.5% for the third quarter of 2025. The core return on average tangible common equity1 for the third quarter of 2026 was 25.0%, compared to 25.0% for the previous quarter and 25.5% for the third quarter of 2025.
The efficiency ratio for the third quarter of 2026 was 59.8%, compared to 67.6% for the previous quarter and 57.7% for the third quarter of 2025. The core efficiency ratio1 for the third quarter of 2026 was 57.8% compared with 57.0% in the previous quarter and 56.2% for the third quarter of 2025. Michael Collins, Butterfield's Chairman and Chief Executive Officer, commented, “Our third quarter earnings were solid, underpinned by stronger net interest and non-interest income along with reduced credit loss provisions.
These results underscore the strength and resilience of Butterfield’s diversified business model and our dedication to meeting the evolving needs of our retail, corporate, and high net worth clients.
We continue to prioritize disciplined capital and risk management, outstanding client service, and the creation of sustainable long-term value. “During the third quarter, we made meaningful progress toward closing the previously announced acquisition of CIBC Caribbean. At our annual meeting on September 18, our shareholders showed their support for the transaction by strongly voting in favor of the issuance of Butterfield shares in connection with the transaction. We continue to expect closing in the first half of 2027.
"Regulatory engagement and integration planning are progressing as expected, and we remain confident in our ability to successfully execute the transaction and realize its long-term strategic and financial benefits. Following the closing, Butterfield will be the leading independent bank across the Atlantic and English-speaking Caribbean with expanded capabilities to provide enhanced personal, corporate, and wealth management services."
The reported net income for the third quarter of 2026 included $3.2 million of non-core, deal-related expenses, primarily associated with the acquisition of CIBC Caribbean and, to a lesser extent, integration-related costs for the R&H Guernsey business. Core net income¹ increased $0.3 million in the third quarter of 2026 compared to the prior quarter.
NII for the third quarter of 2026 was $97.2 million, an increase compared to $95.6 million in the previous quarter and $4.4 million higher than $92.7 million in the third quarter of 2025. NII increased during the third quarter of 2026 compared to the prior quarter and the third quarter of 2025 due to the ongoing reinvestment of securities at higher yields and improved treasury returns, partially offset by loan yield compression and modestly higher deposit costs. Net interest margin (“NIM”) for the third quarter of 2026 was 2.76%, an increase of 2 basis points from the previous quarter and 3 basis points higher compared to 2.73% in the third quarter of 2025. The increase in NIM during the third quarter of 2026 compared to the prior quarter and the third quarter of 2025, resulted from higher yields on reinvestments and treasury securities, partially offset by loan yield compression and modestly higher deposit costs.
Non-interest income for the third quarter of 2026 was $64.8 million, an increase of $1.4 million from $63.4 million in the previous quarter and $3.6 million higher than the $61.2 million in the third quarter of 2025. The increase in the third quarter of 2026 compared to the prior quarter resulted from higher banking service revenue driven by increased card volumes and a non-recurring contractual incentive. Non-interest income in the third quarter of 2026 was higher than the third quarter of 2025 due to higher trust revenue from the new R&H Guernsey business and updated fee agreements, offset by lower time-based fees.
Non-interest expenses were $99.3 million in the third quarter of 2026, compared to $109.8 million in the previous quarter and $90.8 million in the third quarter of 2025. Core non-interest expenses1 of $96.2 million in the third quarter of 2026 were higher compared to the $92.9 million incurred in the previous quarter and the $88.5 million in the third quarter of 2025. Core non-interest expenses1 in the third quarter of 2026 increased compared with the prior quarter and third quarter of 2025, primarily driven by higher salaries and benefits and other expenses.
Period end deposit balances increased to $12.9 billion from $12.7 billion at December 31, 2025. Average deposits were $13.1 billion in the quarter ended September 30, 2026, relatively flat from the prior quarter.
The Board declared a quarterly cash dividend of $0.50 per common share to be paid on November 25, 2026 to shareholders of record on November 10, 2026. No common shares were bought back under the Bank's share repurchase program during the third quarter of 2026, as the program was paused following the May 28, 2026 announcement of Butterfield's planned acquisition of CIBC Caribbean from CIBC. The current total regulatory capital ratio as at September 30, 2026 was 29.6%, compared to 27.8% as at December 31, 2025. Both of these ratios remain conservatively above the minimum regulatory requirements applicable to the Bank.
ANALYSIS AND DISCUSSION OF THIRD QUARTER RESULTS Income statement Three months ended (Unaudited) (in $ millions) September 30, 2026 June 30, 2026 September 30, 2025 Non-interest income 64.8 63.4 61.2 Net interest income before provision for credit losses 97.2 95.6 92.7 Total net revenue before provision for credit losses and other gains (losses) 161.9 159.0 153.9 Provision for credit (losses) recoveries (0.2) (1.6) (0.6) Total other gains (losses) 0.3 1.0 (0.1) Total net revenue 162.0 158.3 153.3 Non-interest expenses (99.3) (109.8) (90.8) Total net income before taxes 62.6 48.5 62.5 Income tax benefit (expense) (1.7) (1.6) (1.4) Net income 61.0 46.9 61.1 Net earnings per share Basic 1.55 1.19 1.50 Diluted 1.50 1.16 1.46 Per diluted share impact of other non-core items 1 0.08 0.42 0.05 Core earnings per share on a fully diluted basis 1 1.58 1.58 1.51 Adjusted weighted average number of participating shares on a fully diluted basis (in thousands of shares) 40,523 40,447 41,944 Key financial ratios Return on common equity 21.3 % 16.6 % 22.5 % Core return on average tangible common equity 1 25.0 % 25.0 % 25.5 % Return on average assets 1.7 % 1.3 % 1.7 % Net interest margin 2.76 % 2.74 % 2.73 % Core efficiency ratio 1 57.8 % 57.0 % 56.2 % (1) See table "Reconciliation of US GAAP Results to Core Earnings" below for reconciliation of US GAAP results to non-GAAP measures.