Carter Bankshares (CARE) Q3 2025 earnings summary

Executive summary

• Net income for Q3 2025 was $5.4 million ($0.24 EPS), down sequentially but nearly flat year-over-year, and nine-month net income was $22.9 million ($1.00 EPS), up from $16.2 million in the prior year period.

• Net interest income rose 17.1% year-over-year to $33.7 million for Q3 2025, driven by loan growth and lower funding costs.

• Achieved strong liquidity and capital position with CET1 at 10.66% and total available liquidity of $1.2B as of September 30, 2025.

• The company completed the acquisition of two North Carolina branches, adding $55.9 million in deposits and expanding its market presence.

• Financial results remain significantly impacted by large nonaccrual loans to the Justice Entities, with $228.6 million principal balance as of September 30, 2025.

Financial highlights

• Net interest income increased $1.4M sequentially and $4.9M year-over-year to $33.7M in Q3 2025; nine-month net interest income was $96.2M.

• Total assets reached $4.84B, up $226.7M year-over-year; portfolio loans grew $239.8M year-over-year, primarily in CRE, construction, and residential mortgages.

• Total deposits rose by $56.9M to $4.2B, including $55.9M from the branch acquisition.

• Net interest margin (FTE) improved to 2.87% from 2.59% a year ago.

• Adjusted efficiency ratio improved to 73.37% from 80.65% year-over-year.

Outlook and guidance

• Management expects continued strong fundamentals, with a healthy loan pipeline and anticipated tailwinds from construction lending over the next 12–18 months.

• Strategic focus on organic growth, operational efficiency, and expansion in target markets.

• Resolution of the large nonperforming credit relationship remains a priority, with confidence in long-term positioning.

• The balance sheet remains liability sensitive, with flexibility to manage deposit and borrowing costs as rates change.