Camden National (NASDAQ:CAC) reported fourth-quarter 2025 net income of $22.6 million, which management described as another “record-setting” result and a 6% increase from the prior quarter. On the company’s earnings call, President and CEO Simon Griffiths and CFO Mike Archer highlighted improvement in core profitability metrics, continued benefits from the Northway acquisition, and early 2026 outlook items tied to margins, loan growth, expenses, and capital deployment.
Quarterly results and profitability metrics
For the fourth quarter, Camden reported diluted earnings per share of $1.33. For the full year ended December 31, 2025, the company reported net income of $65.2 million and diluted EPS of $3.84.
Archer provided more detail, citing fourth-quarter return on average assets of 1.28%, return on average tangible equity of 19.06%, and an efficiency ratio of 51.69%. He said the company has been able to rebuild capital used in the Northway acquisition faster than initially projected, attributing that to the earnings performance following the acquisition and cost takeout initiatives executed in the first half of 2025.
Net interest margin drivers and funding costs
Archer said revenue rose 4% from the third quarter, while net interest income increased 5% quarter over quarter. He attributed the improvement to the 13-basis-point net interest margin expansion to 3.29% and an 11-basis-point decline in funding costs to 1.79%, which he said reflected successful management of deposit costs following recent Federal Reserve rate cuts.
Other drivers cited for net interest income growth included average loan growth of 1%, average deposit growth of 2%, and higher fair value mark accretion of $735,000 due to elevated payoffs on acquired loans. In response to an analyst question, management said fair value accretion totaled $5.3 million for the quarter, and indicated a scheduled or “base” level closer to roughly $4.5 million to $4.75 million, with potential variability depending on prepayments.
Looking ahead, Archer said the company expects “a couple basis points” of margin expansion, plus or minus, in the first quarter of 2026 on a core basis. He also said funding costs could improve by approximately 7 to 10 basis points in the quarter, while warning that yield compression could occur due to repricing characteristics that did not occur in December despite the most recent rate cut.
Deposits, loans, and growth priorities
Archer said deposits rose 2% from September 30, with savings balances up 5% in the quarter and up 28% organically for the year, driven by the bank’s high-yield savings product. Interest checking balances increased 11% from the prior quarter, which he attributed primarily to seasonal municipal deposit flows. Management said it expects first-quarter 2026 deposit balances to be “relatively flat” versus the fourth quarter, despite typical winter seasonality, citing recent deposit relationship wins.
On loans, Griffiths said loans grew organically by 2% for the year, while total loans declined 1% during the fourth quarter due to higher payoffs and prepayments. He said production levels in the third and fourth quarters were comparable, but the higher payoffs “muted an otherwise strong quarter of production.”
Management reiterated an optimistic tone on home equity lending, with Griffiths citing 6% growth in the fourth quarter and 18% organic growth for the year.
On the outlook for loan growth, Griffiths said the company’s residential pipeline was “just over $83 million” and the commercial pipeline was “just over $77 million,” calling those levels solid for January. Management said it expects loan growth to be flat to up 2% in the first quarter of 2026, with a pickup in the April-May timeframe and a mid-single-digit outlook for the rest of the year.
In response to questions about staffing, Griffiths said Camden intends to continue looking for talent in key markets and cited recent hires, internal promotions in the Portland market, and efforts to connect commercial banking with other businesses across the franchise.
Credit quality, provision, and capital actions
Camden’s credit metrics remained low at year-end, according to management. Griffiths said non-performing assets were 10 basis points of total assets at December 31, 2025, and total past due loans were 16 basis points of total loans.
The quarter’s provision for credit losses was $3 million, which Archer said was driven by a single charge-off tied to a commercial real estate office loan. Griffiths described the loan as having been classified for nearly two years; during the quarter, the company completed a short sale that resulted in a $3 million charge-off and an 88% recovery of the loan balance. He said office exposure represented 3.7% of the loan portfolio and added that the company had 35 office loans over $1 million, all pass-rated with positive and acceptable debt service coverage, along with “good occupancy” and “very good” loan-to-value ratios.
Archer said loan loss reserves totaled $45.3 million at year-end, equal to 91 basis points of total loans and 6.4 times non-performing loans. In Q&A, management characterized the recent provision levels as tied to “one-offs” and said it expects net charge-offs to normalize toward historical levels, while indicating comfort with the reserve level around 90 to 91 basis points of loans.
On capital return, Archer noted that the company announced a share repurchase program in early January authorizing repurchases of up to 850,000 shares, or approximately 5% of shares outstanding. Management said its priority remains building capital and supporting organic growth, while being opportunistic with buybacks.
Other items discussed on the call included Camden’s wealth and brokerage performance—Griffiths said assets under administration increased 15% organically to $2.4 billion—as well as digital product launches and automation initiatives. The company also discussed its posture toward M&A, describing itself as opportunistic but focused on contiguous markets and deal fit similar to the Northway transaction, while indicating that Boston would be outside its “sweet spot” absent a compelling, case-by-case opportunity.
About Camden National (NASDAQ:CAC)
Camden National Corporation is a bank holding company headquartered in Camden, Maine. Through its primary subsidiary, Camden National Bank, the company provides a full range of community banking services to individuals and businesses. Its branch network spans much of the State of Maine, with a concentration in the midcoast, central and southern regions.
The company’s offerings include deposit products such as checking, savings and money market accounts, along with consumer and commercial lending services.
