RBB Bancorp Q2 net interest income falls from prior quarter on higher interest expense

Overview

• US community bank's Q2 net income and EPS declined from the prior quarter

• Net interest income and margin fell due to higher interest expense and lower FHLB dividend income

• On June 15, company announced new 1 mln share buyback plan

Outlook

• Company expects 2026 effective tax rate to be 28.0%, up from 24.2% in 2025

Result Drivers

• HIGHER INTEREST EXPENSE - Net interest income declined due to increased interest expense, mainly from subordinated notes repricing to a higher rate and one more day in the qtr

• LOWER NONINTEREST INCOME - Noninterest income fell due to lower gains from OREO and the absence of one-time items such as loan recoveries and tax refund interest seen in the prior qtr

• IMPROVED CREDIT QUALITY - Nonperforming assets and substandard loans declined, reflecting improved credit quality

Company press release: ID:nGNX1nBYsH

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy."

• Wall Street's median 12-month price target for RBB Bancorp is $27.00, about 0.2% below its July 17 closing price of $27.06

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 10 three months ago

Reuters Recommended Reads

• July 20 - Peoples Bancorp of North Carolina Q2 net interest income rises

• July 20 - MainStreet Bancshares Q2 profit rises on higher interest margin

• July 17 - Hingham Institution for Savings Q2 net income more than doubles on higher loan yields, lower funding costs

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)